Why Apple's Mobile Ad Push Could Help Google's AdMob Deal
That deal, in which Google payed $750 million in stock for AdMob, is currently under Federal Trade Commission scrutiny, and the agency is reportedly assembling a legal team to challenge the pact.
Clearly, Apple wanted AdMob. But ironically, Apple's aggressive push into mobile advertising may help ameliorate regulatory concern over the AdMob deal. Or at least that's what Google CEO Eric Schmidt would like us -- and the FTC -- to believe.
Over the weekend, Schmidt said that Apple's iAds launch is "evidence of a highly competitive market," according to Reuters.
"Just Seems Obvious"
In other words, no need for the FTC to block the deal on antitrust grounds. "It just seems obvious to me," Schmidt was quoted as saying. "I hope it (Google's purchase of AdMob) gets approved."
It seems fairly obvious to me as well. As AdAge.com noted last week, "AdMob had $31 million gross revenue in 2009 and 11% market share, according to market research firm IDC. Added to Google's existing mobile ad business, which is primarily mobile search, the acquisition would make Google the mobile ad leader with 21% market share."
That contrasts with Apple's "consolation prize" of Quattro Wireless -- snagged for $275 million in January -- which had "$20 million in gross revenue for 2009 and 7% market share," AdAge.com said.
FTC Seems Serious
Yes, Google would emerge as the mobile ad market leader if the AdMob deal is approved. But compared to the Web giant's domination of Internet search, Google's lead in the nascent mobile ad market is much less extreme. It would be a shame if the federal government intervened in a very young market that remains in the earliest stages of development.
Nevertheless, the FTC appears to be quite serious about challenging the deal. Reuters quoted an application developer who had been interviewed by the agency as saying, "It's been really interesting talking to them because they are so dead set against this. They have been clearly positioning to try to stop this."
Instead, perhaps the FTC should stop its apparent plans to interject the heavy hand of the government into what appears to be a competitive market that remains in the earliest stages of growth.