eMarketer’s recent publication of various mobile ad spending forecasts portrays Borrell as a radical outlier. Naturally, we agree. And we’re eager to point out that we’ve been an outlier many times in the past, particularly in the early years of forecasting a new trend. Each time, our forecasts eventually became true. As one commentator put it, “Either Borrell knows something the other [forecasting] companies don’t know … or Borrell is way off base.” The statement is half correct. We do know something they don’t know. But first, a few words about Arthur C. Clarke.
For those of you who don’t remember him, Clarke was one of the last century’s greatest science fiction writers. His stories foresaw communication satellites, self-aware computers (remember HAL?) and many other marvels of technology we take for granted now or will in the near future. Clarke was also a futurist: a student of forecasts and predictions. His book, Profiles of the Future, first published in 1962, talks about two failures common to forecasters of all stripes – a failure of confidence, and a failure of imagination.
When forecasts are too timid, too sensitive to the commonly held values of others, that is a failure of confidence. In his book, Clarke recommends that most forecasts should have their effects tripled and their time to occurrence reduced by half – in order to make them more accurate.
When forecasts are too mild, and show too little change from the present, that is a failure of imagination. Clarke’s opinion here is buttressed by research conducted in the 1970s by the International Association of Experimental Psychologists. Their research found that only one in every 10,000 people can envision a future much different from the present.
So, what does all of this have to do with mobile ad spending? Just this: we believe most forecasts we’re compared to suffer from the failures Clarke identified. Here’s why. The hardest part of forecasting mobile is determining where the dollars fall in comparison to online as a whole. However, many who forecast this space look at “mobile” as its own entity – separate and distinct from online. In such a case, any forecast must use as its base the number of discreet mobile devices available, and then try to attach spending levels to that base.
Borrell takes a different course. We believe that mobile is, in fact, a subset of online. Our forecast is also supported by expected changes in computing devices capable of receiving and processing mobile ad messages. By our count, there are roughly 45 million of these devices being used in the U.S. today – mostly smartphones and iPads. By 2015, the count will have ballooned to more than 144 million, with much of the growth among other devices – including most laptop computers, cameras, game machines, GPS devices, and even cars.
Within five years, each of these device categories will be able to receive and react to mobile advertising messages. The new Apple laptop is a good early example of this trend. It can download apps and contains GPS and 4G technology. So, in our forecast, it’s not so much that mobile devices take over as it is that most computing devices become mobile. Based on this more expansive view, the majority of online ad spending will be targeted to mobile devices by mid-decade. By then, the differences between a “mobile” ad and an online ad simply won’t exist.
In reality, our forecast looks at mobile so differently from others that we are forecasting different things. It’s no wonder, then, that they look so different. Our numbers are neither timid nor mild, but we strongly believe they are on the right track.
We think Mr. Clarke would approve.