Google CEO Bullish on Mobile Internet Advertising

The arrival of a truly mobile Web, offering a new generation of location-based advertising, is set to unleash a “huge revolution,” Google CEO Eric Schmidt said on Friday.

“It’s the re-creation of the Internet, it’s the re-creation of the PC [personal computer] story and it is before us — and it is very likely it will happen in the next year,” he told a panel at the World Economic Forum, in Davos, Switzerland.

Current estimates for mobile advertising are cautious, with research firm Forrester predicting revenues of under $1 billion by 2012.

But Schmidt said this figure was too low and failed to take into account that the mobile Web was reaching a tipping point.

Google aims to be a prime mover by bidding for coveted airwaves to launch an open U.S. wireless network, pitting it against established telecommunications players. The move will take the Silicon Valley-based company well beyond its core Web search and online advertising franchises.

Although the high costs worry some analysts, Schmidt said he was confident location-based advertising — which could, for example, direct hungry travelers to nearby restaurants — would be “a very, very good business.”

Content providers, already struggling in the modern world of music and film downloads, are less convinced that the mobile Internet is a gold mine.

“It is not going to be easy to hang on the price of content,” said Howard Stringer, chief executive of Sony.