Having Ads Is Just Not Enough

As Mary Meeker reports, the eCPM for mobile is just $.75. Meanwhile, the eCPM for desktop is $3.50. Of course, people has been using the PCs for surfing the internet for a long time, while while mobile has just blown up. So in regard to designing, launching, tracking, measuring and optimizing display campaigns, people working for the PC obviously has an advantage.

But let’s assume mobile can get to where PC’s already at in regard to revenue. Of course, that’s assuming a lot, but let’s say in the best case scenario, mobile figures out how to display ads effectively on a smaller screen, mobile does siphon PC’s traffic, gets higher rate, and it’s not disrupted by the new new thing. Yet even then, I don’t think mobile advertising would be able to sustain a business.

To understand why that is, it is necessary to understand how newspapers like The New York Times made money. When most people think of The Gray Lady, they think about quality (or bias) content, but traditionally only a small part of The Times’ revenue comes from selling that content. Most of The Times’ profit comes from advertising, and there are two sorts.

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