Google May 27 closed its purchase of mobile advertising network AdMob, setting up a battle with Apple for digital ads served in applications on smartphones. Most attractive to Google is AdMob's leading position in in-application ads, which are dropped into applications users may purchase and download from stores such as Apple's iPhone App Store and Google's own Android Market. Apple will also offer in-app ads on its iPhone 4.0 in June.
Google May 27 closed its
purchase of mobile advertising network AdMob, setting up a battle with Apple
for digital ads served in applications on smartphones.
The search engine will commence integrating its AdSense
for mobile programs with AdMob's mobile ad software. Google also gains the AdMob team,
whose expertise made Apple come calling with an offer of $600 million before
Google swooped in with a sweeter $750 million deal.
Most attractive to Google is AdMob's leading position in
in-application ads, those ads sitting in applications users purchase and
download from stores such as Apple's iPhone App Store and Google's own Android
Market.
AdMob has created a number of ad units for iPhone and
Android applications, including interactive video ad units and expandable rich
media ads.
This is exactly the tack Apple is taking with its iAd
mobile ad platform, fashioned from Apple's purchase of AdMob rival Quattro Wireless.
Apple
bagged Quattro in January after Google moved on AdMob last November. iAd is expected
to
launch with the iPhone 4.0 at Apple's Worldwide Developers' Conference June 7.
But Google has also been developing new features for
in-app ads. Google Vice President of Engineering Vic Gundotra
said at Google
I/O May 20 that Google will be making its "click-to-call" ad formats
available to developers who run AdSense in their mobile apps.
Advertisers may use click-to-call ads to include a local
business or national phone number directly in their ad text. Users can then click
to call the business via phone.
"It's clear that mobile advertising is becoming a
much larger part of our clients' and partners' strategies and with this
acquisition, it's now a central part of our own business,"
said Susan Wojcicki, vice president of product management for Google.
"In continuing to invest in this highly competitive
area, we'll be bringing together our technology, resources and expertise in
search advertising with AdMob's innovative solutions for advertising on mobile
websites and in mobile applications."
Google's bid for AdMob seemed like a long shot at the
beginning of May. The Federal Trade Commission appeared set to
sue Google to block the deal because it believed the deal would make Google too
powerful in the mobile ad market.
After
speaking to Google rivals and other mobile ad providers, most of whom
told the commission the market is too nascent and fragmented to proclaim Google king
with AdMob, the FTC
blessed the deal May 21.
The battle between Google and Apple in mobile ads should
begin in earnest when Apple starts serving ads through iAd on new iPhones this
summer. Early indications are that Apple is
charging $1 million for some iAd campaigns.
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