Android Ad Business May Top $1 Billion Next Year

2012 may prove a banner year for Google in the mobile space. The internet search giant may very well generate upwards of one billion in Android-related advertising revenue next year.

The new projection comes from Piper Jaffray analyst Gene Munster. On Tuesday morning, Munster asserted in a research note – covered by Forbes – that Android generated $5.90 per use in mobile advertising last year. Munster expects that figure to hit $9.85 in 2012.

Munster notes that former CEO Eric Schmidt last summer said he though Android could be a $10 billion business if there were 1 billion users each generating $10 a year – and the analyst contends the company is well on the way to hitting the $10 per user level.

The prominent analyst also took care to observe how Google will gain immeasurably from skillful development of the Android Market app store, which could drastically boost monetization per user from in-app advertising over the next two years.

Within twelve months from now, Munster believes there may be as many as 133 million Android users generating the aforementioned $9.85 a year. That’s how Munster gets to his estimated $1.3 billion in Android-related revenue for 2012.

Eric Savitz of Forbes’ Tech Trade blog noted that “the Street” is looking for overall Google revenue in 2012 to be $31.7 billion. “Munster’s estimate would put Android-related revenue at about 4% of the total,” Savitz says.