FTC Approves Google Purchase of AdMob

By Gary Kim, Contributing Editor

What a week for Google (News - Alert). First it holds an ebullient developer conference where it announces the high-profile launch of Google TV, details on version 2.2 of the Android operating system (Froyo) that had developers applauding, and now the Federal Trade Commission by a five-to-one unanimous vote, has approved Google's purchase of AdMob (News - Alert).

The $750 million deal is a building block for Google's moves into the mobile advertising space, and, as it turns out, Apple's own moves helped convince the FTC (News - Alert) that antitrust dangers were not sufficient to block the acquisition.

'The agency's concerns ultimately were overshadowed by recent developments in the market, most notably a move by Apple Computer Inc. - the maker of the iPhone (News - Alert) - to launch its own, competing mobile ad network,' the FTC said.

'In addition, a number of firms appear to be developing or acquiring smartphone platforms to better compete against Apple's iPhone and Google's Android, and these firms would have a strong incentive to facilitate competition among mobile advertising networks,' the FTC noted.

"As a result of Apple's entry into the market, AdMob's success to date on the iPhone platform is unlikely to be an accurate predictor of AdMob's competitive significance going forward, whether AdMob is owned by Google or not," the FTC said.

The salient factor here is an apparent huge change of sentiment at the FTC after Apple launched iAd, suggesting the FTC believes Apple will be a formidable competitor, and even could make Google's efforts to grow its mobile ad business much more challenging, as much AdMob traffic presumably would siphon off to Apple's iAd network.

Once Apple made clear that iAd would not share analytics with third party networks, such as AdMob, the FTC apparently concluded that Google might in fact find a majority of its current business--based on the iPhone--could diminish, if not cease.

That apparently provided all the evidence the FTC needed to conclude that, at least for the moment, Google's purchase of AdMob would pose no undue threat to competition in the market.

Google's new Android 2.2 mobile operating system, Froyo and Google TV seem designed to support mobile advertising.

Google's VP Vic Gundotra says the new products will leverage the company's existing strengths in advertising, including mobile advertising. 'We know a little about advertising,' says Gundtra. 'We're not new at this game.'

Gundotra points out the mobile ad formats currently available from Google that nclude text ads and click-to-call ads as well as new 'in-app rich media' ad formats.  A geo-location-based ad, which provides users with mapped directions and click-to-call functionality, will be available 'shortly.'

Gundotra says Google remains committed to opening up the Google platform, both in terms of advertiser access and to third party technologies. That's the opposite of Apple's more-closed approach.

Google also is taking a different approach to authoring of video, supporting both Adobe's Flash plug-in as well as HTML5. Apple is supporting HTML5 exclusively.

'It turns out that on the Internet, people use Flash,' Gundotra says. 'Part of being open means you're inclusive, and it's fun to work with everyone in the ecosystem to meet the needs of users.' For Google, that means supporting both Flash and HTML5.

(source: http://dns.tmcnet.com/topics/web-traffic-management/articles/86092-ftc-approves-google-purchase-admob.htm)