Verizon announced that early next year it will allow limited banner advertising on Internet sites that appear on their mobile phones. The company's decision is a significant but cautious advance into the world of tiny screen advertising. Despite confidence that mobile advertising is "poised to take off", Verizon, major ad agencies and national brands are still unsure of the absolute value of the medium. All of the players are walking a fine line between reaching potential customers and annoying or inconveniencing them. Ad agencies maintain that until decent video and ad placement are available on mobile phones, it will not be a limited advertising medium. According to industry analysts, mobile ad spending was $45 million in 2005 and will probably increase to approximately $150 million this year. Mobile advertiser could spend as much as $1.3 billion by 2010.
• Sources: NYTimes
• Related commentary: Time For Wireless Carriers to 'Unlock' Customer Handsets, Verizon: 2007 A 'Tipping Point' For Earnings Growth?, Verizon and Sprint: The Prince and The Pauper Conference call transcripts: Verizon Q3 2006 Earnings
• Potentially impacted stocks and ETFs: Verizon Communications Inc. (NYSE:VZ) Competitors: AT&T Inc. (NYSE:T), Sprint Nextel Corp (NYSE:S), BellSouth Corp (BLS) ETFs: Telecom HOLDRs (NYSEARCA:TTH), First Trust Morningstar Div Leaders Idx (NYSEARCA:FDL), WisdomTree High-Yielding Equity (NYSEARCA:DHS), WisdomTree LargeCap Dividend (NYSEARCA:DLN)
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