This document summarizes surveys of over 500 advertisers, publishers, and developers about the state of the mobile apps industry in 2010. Some key findings include: - The number of mobile apps developed by advertisers significantly increased from 2009 to 2010, especially for those developing 20-50 apps. - Android and iPad saw the most growth as app platforms used by advertisers between 2009 and 2010, though iPhone still led. - 71% of advertisers worked with a mobile ad network in 2010 to help with their app strategies. - App budgets in 2010 moved away from cannibalizing online budgets, with budgets specifically for app development growing year-over-year. - Advertisers, publishers,

1. STATE
OF THE
ADUSTRY
IN
PPS
YESTERDAY
TTODAY
& OMORROW
A Survey of Over 500 Advertisers, Publishers & Developers - October 2010

2. The State of the Apps Industry:
Yesterday, Today & Tomorrow
A Survey of Over 500 Advertisers, Publishers & Developers - October 2010
Table of Contents
PAGE 3
Executive Summary/Highlights
PAGE 4 6
State of the Apps Industry Yesterday & Today
PAGE 7 8
Projections for the Apps Industry in 2011
PAGE 9
Summary & Methodology
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3. www.millennialmedia.com/research The State of the Apps Industry
Executive Summary
In Q3 2010, Millennial Media collaborated with DIGIDAY and Stifel Nicolaus to survey advertisers/marketers,
publishers, and developers on their current mobile app practices in 2010 and intended plans for 2011. As the
mobile applications industry continues to evolve, this data provides a critical view on where the industry stands
today and where advertisers/marketers, publishers, and developers will be placing their bets in the coming year.
An earlier DIGIDAY: State of the Apps Industry study that was run in Q4 2009 enables directional year-over-year
comparisons from 2009 to 2010.
This report illustrates how mobile continues to drive deeper into digital ad budgets, which platforms have
surged in adoption, and how advertisers, publishers, and developers plan to support in-application advertising
and development in the coming year.
Highlights
The number of mobile applications developed by advertisers/marketers in 2010 increased significantly
year-over-year.
From 2009 to 2010, Android and iPad saw the most significant growth as the app platforms used by
advertisers. iPhone still leads the pack, but RIM, Windows Mobile, and Symbian also saw increases, as
advertisers continued to diversify to balance their application platforms.
71% of advertisers worked with a network in 2010 (up 12% from 2009) to help further their apps
strategies. The top 3 reasons cited for working with a network were reach, targeting, and cost per
download.
Applications budgets in 2010 moved away from cannibalizing online budgets. Budgets designated
specifically for app development grew year-over-year, now comprising nearly 25% of the overall mix.
Advertisers, publishers, and developers will continue to diversify their applications strategies in 2011.
Android, iPad and Windows Phone 7 lead the pack among the platforms next on the docket to receive
support in the coming year.
Publishers anticipate significant growth in their applications revenue in 2011. When asked to estimate
their earnings over the coming year, a full 31% expect their applications revenue to increase 100% or
more in 2011, with another 17% expecting an increase of 50% or more.
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4. www.millennialmedia.com/research The State of the Apps Industry
State of the Apps Industry Yesterday & Today
Advertisers, publishers, and developers grew their presence in the apps space significantly from 2009 to
2010. Marked by increases in the number of mobile apps developed, diversity across platforms, and
dedicated budgets for apps development, this shows healthy year-over-year growth.
Number of Mobile Apps Developed by The number of mobile applications developed by
Advertisers (2010 vs. 2009) CHART A advertisers/marketers in 2010 increased
significantly year-over-year. When asked the
number of mobile applications developed in 2010
1
>50
2
vs. 2009, advertisers stated growth in every area. In
particular, advertisers developing 20-50 apps stated
4 an astounding jump (from 4 in 2009 to 83 in 2010).
>20 83
Conversely, the number of advertisers who did not
5 to 10
10 develop a single application decreased
11
year-over-year (from 19 in 2009 to 11 in 2010).
66
1 to 5 69
Growth for publishers in 2010, as with advertisers,
0
19 came in the amount of experience in building
11
applications. While the bulk of publishers in 2010
0 20 40 60 80 100
focused on developing 1-5 mobile applications,
there was a burst of publishers who mastered the
2009 2010 art of developing mobile apps and turned out
greater than 50.
State of the Apps Industry 2010 and 2009 Surveys; DIGIDAY, Stifel Nicolaus, Millennial Media.
Verticals Building Branded Applications
CHART B
2010 2009 Of those advertisers/marketers developing
1. Entertainment 1. CPG
applications for their business, a number of key
brand verticals are represented. In 2009, CPG, Retail,
2. Technology 2. Retail Auto, Entertainment and Financial companies were
3. Media 3. Auto the top 5 verticals building apps. In 2010, however,
4. Retail 4. Entertainment Entertainment displaced CPG to claim the number
5. CPG 5. Financial
one spot, followed by Technology, Media, and
Retail. CPG remained in the top 5 at number 5.
State of the Apps Industry 2010 and 2009 Surveys; DIGIDAY, Stifel Nicolaus, Millennial Media.
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5. www.millennialmedia.com/research The State of the Apps Industry
State of the Apps Industry Yesterday & Today CONTINUED
Top 5 Considerations for Choosing a Platform:
Both advertisers and publishers, when selecting which 1. REACH
platform to develop for, have taken an increasingly 2. DEMO
cross-platform approach. Android and iPad have led the
pack with significant growth, though iPhone still 3. BETTER BRANDING
remains the top platform of choice. Windows Phone 7 4. EASE OF USE
and Symbian also saw growth among both advertisers 5. HIGHER SALES POTENTIAL
and publishers.
State of the Apps Industry 2010 and 2009 Surveys; DIGIDAY, Stifel Nicolaus, Millennial Media.
Mobile App Platforms For Which Advertisers/
Marketers Are Developing (2009 vs. 2010) CHART C
0
Windows Mobile
8
0 2009
Symbian 2010
6 From 2009 to 2010, Android and iPad saw the most
iPad
0
significant growth as the application platforms
35
36
used by advertisers. iPhone still leads the pack, but
Palm
2 RIM, Windows Mobile, and Symbian also saw
RIM
6 increases, as advertisers continued to diversify their
17
application platforms.
10
Android
28
62
iPhone
73
0 20 40 60 80 100
State of the Apps Industry 2010 and 2009 Surveys; DIGIDAY, Stifel Nicolaus, Millennial Media.
Mobile App Platforms For Which Publishers
Are Developing (2009 vs. 2010) CHART D
0
Windows Mobile
9
0
Symbian
5 Among publishers, Android, iPad, Windows Mobile,
5
iPad 2009 and Symbian also grew year-over-year from 2009
8 2010
24
to 2010. Again, Android and iPad saw rapid
Palm
19 acceptance by publishers, and efforts were
RIM
0 focused on developing applications for these
32
players. iPhone and Palm were the two platforms
21
Android
36
that saw year-over-year decreases.
47
iPhone
46
0 10 20 30 40 50
State of the Apps Industry 2010 and 2009 Surveys; DIGIDAY, Stifel Nicolaus, Millennial Media.
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6. www.millennialmedia.com/research The State of the Apps Industry
State of the Apps Industry Yesterday & Today CONTINUED
Top Considerations for Using a Network:
Of the 71% of advertisers who say they use a network
1. REACH
(up 12% from 2009), the top 3 reasons advertisers 2. TARGETING
listed for using a network include: 3. COST PER DOWNLOAD
State of the Apps Industry 2010 and 2009 Surveys; DIGIDAY, Stifel Nicolaus, Millennial Media.
Budget Area Funding Advertiser/Marketer
Applications (2009 vs. 2010) CHART E
19%
Own designated
23%
Whereas online budgets appeared to be the
10%
Other source of applications activity for
8%
advertisers/marketers in 2009, applications
Online
57% budgets in 2010 moved away from cannibalizing
42% online budgets.
5%
Promotions
11% In fact, budgets designated specifically for apps
4%
development grew year-over-year, now
Direct Response
5% comprising nearly 25% of the overall mix.
Additionally, given the always-on nature of mobile
0%
Customer Service
2009 media, a substantial portion of promotional
2%
2010
budgets now funds applications.
11%
Branding
11%
0 20% 40% 60%
State of the Apps Industry 2010 and 2009 Surveys; DIGIDAY, Stifel Nicolaus, Millennial Media.
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7. www.millennialmedia.com/research The State of the Apps Industry
Projections for the Apps Industry in 2011
To reach mobile consumers as effectively and efficiently as possible, advertisers, publishers, and developers
will continue to diversify their applications strategies in 2011. The survey findings show that Android, iPad
and Windows Phone 7 lead the pack among the platforms next on the docket to receive support in the
coming year. Publishers also anticipate significant growth in their applications revenue in 2011 and mobile
budgets on the whole should continue to increase.
New Application Platforms Advertisers
Plan to Support in 2011 CHART F
60 55
50
When asked what platforms
45
advertisers/marketers will add support for in
40 the coming year, Windows Phone 7 appears
30 ready to supplant RIM and iPhone in
24
21 17
emphasis, while marketers lend even more
20
14 intensity to iPad and Android.
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State of the Apps Industry 2010 and 2009 Surveys; DIGIDAY, Stifel Nicolaus, Millennial Media.
New Application Platforms Publishers
Plan to Support in 2011 CHART G
15 14
Windows Phone 7 is tied for second place
10 10 with iPad as the platform that will be added
10
to most publishers’ plates in the coming year,
6
5 4 and Android appears in pole position to
3
2 challenge iPhone for the top spot of
platforms for which publishers create
applications.
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State of the Apps Industry 2010 and 2009 Surveys; DIGIDAY, Stifel Nicolaus, Millennial Media.
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8. www.millennialmedia.com/research The State of the Apps Industry
Projections for the Apps Industry in 2011
Advertiser App Budget Growth Projections
for 2011 (vs. 2010 spending) CHART H
When comparing actual applications budgets
0% in 2010 and projected apps budgets in 2011, a
>$5MM
5%
$1MM-$5MM
small portion of advertisers project that apps
7%
7% $500K-$1MM spending will exceed $5MM in 2011. The
2010 Spending
5% $201K-$500K percentage of advertisers expecting budgets to
35%
$101K-$200K increase in the $1MM-$5MM range also
16%
26%
$50K-$100K increased year-over-year. Though these
<$50K
$1MM+ spenders make up just less than 10%
2% Don’t know
7% of the overall group, the increase in
5% million-dollar budgets highlights the growing
7%
2011 Spending
17%
importance of mobile apps within advertisers’
27% plans. A significant increase is also expected in
7%
27%
the $101K-$200K range, pulling primarily from
the $50K-$100K and <$50K ranges.
0 5 10 15 20 25 30 35 40
State of the Apps Industry 2010 and 2009 Surveys; DIGIDAY, Stifel Nicolaus, Millennial Media.
Publishers’ Expected Increase in Apps
Revenue from 2010 to 2011 CHART I
Publishers anticipate significant growth in their
6% 2% applications revenue in 2011. When asked to
10% 100% increase or more
estimate their earnings over the coming year, a
>50% increase
>25% increase full 31% expect their apps revenue to increase
17% 31% 10-25% increase 100% or more in 2011, with another 17%
5-10% increase
1-5% increase
expecting an increase of 50% or more. Only
<1% increase 10% of respondents expect their revenues to
17% Flat remain flat.
17%
State of the Apps Industry 2010 and 2009 Surveys; DIGIDAY, Stifel Nicolaus, Millennial Media.
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9. www.millennialmedia.com/research The State of the Apps Industry
Summary & Methodology
About Millennial Media
Millennial Media is the proven leader in mobile advertising. With the largest mobile media audience in the U.S., Millennial
Media uniquely offers brand advertisers the only set of specific, scalable audiences. Our ability to reach, target and engage
consumers is unparalleled. As an innovative technology leader, our mobile decisioning, serving and mediation platforms are
powering some of the largest companies in the media business today. The company is committed to growing the mobile
advertising marketplace by becoming the preferred partner to all advertisers seeking to reach mobile consumers, all publishers
and developers seeking to maximize ad revenue and all mobile operators seeking to further monetize their networks. For more
information, please visit http://www.millennialmedia.com or follow us on Twitter @millennialmedia. Millennial Media
was named the 2010 OnMedia Top Private Company in Digital Media and was awarded a 2010 Stevie Award (American
Business Awards) for Most Innovative Company of the Year.
About DIGIDAY
DIGIDAY hosts conferences on emerging media for digital media and marketing professionals. Our brand promise is that, after
any given DIGIDAY, attendees should have all the direction and resources they need to execute flawlessly in each new genre.
Each conference provides the opportunity to survey the industry for market trends. Our State of the Industry snapshots are
briefed in DIGIDAY:DAILY and the full studies published to DM2PRO.com, a knowledge base for digital media and marketing
professionals with how-to tutorials on cutting edge media genres, winning creative and content award entries for the MOBI,
SAMMY and DPAC Awards, and full video from our past shows. Sign up for DIGIDAY:DAILY at http://www.bit.ly/addTwS to
follow our upcoming research.
About Stifel Nicolaus
Stifel Financial Corp. (NYSE: SF) is a financial services holding company headquartered in St. Louis, Missouri, that conducts its
banking, securities, and financial services business through several wholly owned subsidiaries. Stifel clients are primarily served
in the U.S. through 310 offices in 43 states and the District of Columbia through Stifel, Nicolaus & Company, Incorporated and
Thomas Weisel Partners LLC, and in two Canadian provinces through Stifel Nicolaus Canada Inc. Clients in the United Kingdom
and Europe are served through offices of Stifel Nicolaus Limited and Thomas Weisel Partners International Limited. Each of the
broker-dealer affiliates provide securities brokerage, investment banking, trading, investment advisory, commercial and retail
banking, and related financial services to individual investors, professional money managers, businesses, and municipalities.
Stifel Bank & Trust offers a full range of consumer and commercial lending solutions. To learn more about Stifel, please visit the
company’s web site at www.stifel.com.
Survey Methodology & Disclosures
Two surveys were used to provide the data used in this report. The State of the Apps Industry survey pools used by DIGIDAY
consisted of approximately 600 digital and/or mobile industry professionals in two industry snapshots taken in November
2009 (Q4 2009) and August 2010 (Q3 2010). For clarity, all charts in this report reference only the year in which the survey was
conducted. In 2010, 41% of survey respondents classified themselves as Agency/Advertiser/Marketer, 30% as Application
Developer, and 29% as Publisher. In the 2009 survey, the breakout was 41%, 30%, and 29%, respectively. DIGIDAY believes its
data to be representative of industry trends, even in their more targeted segments. More recently, DIGIDAY partnered with
Jordan Rohan of Stifel Nicolaus, a leading Wall Street analyst of emerging media, to capture his views of what the trends
captured portend for the growth and direction of these media and their potential impact on the market as a whole.
For More Information
Visit www.millennialmedia.com/research to sign up to receive Millennial Media-related news, including Millennial Media’s
Mobile Mix™ and the Scorecard for Mobile Advertising Reach and Targeting (S.M.A.R.T.)™ reports.
To learn more about our growing mmDev developer community or to download our latest cross-platform SDKs, visit
http://developer.millennialmedia.com.
For questions about the data in this report, or for recommendations for future reports, contact us directly at
marketing@millennialmedia.com.
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