Game on
When Google first announced its bid to acquire the world's biggest mobile advertising company - AdMob - last year, our first concerns were for competition in the electronic advertising market. Google already dominates search advertising and AdMob gives it a big head-start in mobile display.
And it wasn't just us that was concerned; before long the US FTC decided to have a look at the deal, citing the same concerns. Meanwhile Apple, having been out-bid for AdMob by Google, snapped up consolation prize Quattro. Having no significant advertising interests, Apple was at liberty to complete its acquisition of Quattro quickly, and by April it had announced the iAd platform.
The irony of the FTC investigation into the AdMob acquisition was that it had left the door open for Apple to make a move which, while not monopolistic, allowed it to further exploit the most world's currently most successful mobile device platform. The FTC acknowledged this fact and said that the presence of iAds meant there was sufficient competition for Google even after the AdMob acquisition.
Understandably, having finally got the FTC out of its face, Google has wasted little time in closing the acquisition, and announced as much late yesterday though its preferred vector of the blog. "We're working to make this integration happen as fast and as seamlessly as possible," said Susan Wojcicki, VP of product management.
There weren't too many details revealed about precisely what Google is going to with AdMob, but there were some clues. Wojcicki spoke about things like ‘click to call' ads, but what AdMob provides is display ads for websites and apps (including iPhone/iPad ones). These include interactive video and expandable rich media ads,
The reason mobile advertising is important is the same as for all other forms of advertising - reach. Advertisers can potentially communicate with more people in more environments in a more targeted way via mobile advertising than through even the conventional Internet.
Furthermore, the vast majority of apps downloaded onto mobile devices are free, and that's unlikely to change thanks to the market expectation fostered by the Internet and all other ad-funded broadcast media before it. The main way to make money out of developing mobile apps will remain advertising, and the company that facilitates this advertising stands to make a killing from its piece of the action.
This is why the two front-runners in the mobile Internet space have made mobile advertising such a big part of their strategy, and why all other would-be players in this space had better raise their mobile advertising game, quickly.
