Google acquires mobile ad company AdMob for $750 million

Filed in Gather News Channel by on November 9, 2009 0 Comments

In an acquisition that indicates a strong commitment to mobile advertising, Google has snatched up Silicon Valley company AdMob for $750 million.

The deal is one of Google’s largest acquisitions ever, and gives them control of the largest mobile advertiser on phones.

AdMod was founded in 2006 by Omar Hamoui, who created the company after having problems generating traffic for his mobile site. The company specializes in web display ads and app display ads, two areas Google’s current mobile advertising doesn’t cover.

The effectiveness of mobile advertising has grown as mobile phones have developed, with smartphones like the iPhone really making it a viable option for companies. Google saysthat Google searches via smartphone have increased by a factor of 5 in the last two years, and marketer spending on mobile advertising is growing at 30% annually.

Prior to the development of smartphones, especially the iPhone, mobile advertising wasn’t seen as a primary source of advertising, because ads were tethered to specific carriers or devices. Once mobile phones were designed to connect to the mobile web, however, mobile advertising became a possibility because ads could be created that would be visible to all mobile phone users.

Even though Google owns the mobile phone OS Android, it is considered unlikely that they will give their OS any priority or bias. Doing so would risk a competitor stepping in to fill the gap for iPhone users.

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