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Google to Acquire AdMob for $750 Million

finance.yahoo.com

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Re: Google to Acquire AdMob for $750 Million

#11

Post by acgourley »

eli wrote: post #7
acgourley wrote: post #5

So obviously I don't understand this market at all, can someone explain to me why google couldn't just copy ad-mob's business practices and features?

They did. Google's been running mobile ads (first in Japan, then worldwide) since 2006. But AdMob just plain does it better -- nicer interface and significantly higher CPMs for publishers. I'm sure they also wanted the talent. I've met one or two of the AdMob guys and they seem pretty sharp.

Seems like google could have used some of that 750M to operate at a loss, pay out higher CPMs and attract publishers. It also seems like google could have, in theory, copied their interface or even improved on it. Could it be that google's now too big to make those kind of adjustments once it builds the momentum?

The talent angle of course makes sense, they are both pulling in top tier employees and removing top tier competition.

Re: Google to Acquire AdMob for $750 Million

#12

Post by dskhatri »

acgourley wrote: post #5

So obviously I don't understand this market at all, can someone explain to me why google couldn't just copy ad-mob's business practices and features?

The opportunity cost would likely be much more than $750 million. Google isn't a nimble, agile startup. AdMob is already a key player in this market[1] serving display ads in apps as well as sites.

[1] Given analysts use AdMob metrics to figure out market shares of various mobile phones

Re: Google to Acquire AdMob for $750 Million

#13

Post by unohoo »

Taking into account the admob and gizmo acquisitions, I cant help but admire google's acquisition strategy. Yes, they have made several acquisitions (dodgeball,jaiku etc.) only to shelve them later, but a lot of their acquisitions (doubleclick, analytics, admob) etc. are super strategic moves - compare this to yahoo's approach over the last few years, which acquired so many startups only to deadpool or offload majority of them.

Re: Google to Acquire AdMob for $750 Million

#15

Post by litewulf »

acgourley wrote: post #11
eli wrote: post #7

Earlier quoted context omitted.

They did. Google's been running mobile ads (first in Japan, then worldwide) since 2006. But AdMob just plain does it better -- nicer interface and significantly higher CPMs for publishers. I'm sure they also wanted the talent. I've met one or two of the AdMob guys and they seem pretty sharp.

Seems like google could have used some of that 750M to operate at a loss, pay out higher CPMs and attract publishers. It also seems like google could have, in theory, copied their interface or even improved on it. Could it be that google's now too big to make those kind of adjustments once it builds the momentum? The talent angle of course makes sense, they are both pulling in top tier employees and removing top tier…

Its possible that operating at a loss would attract ire (because it really would be like the behavior Microsoft is/was so criticized for).

Re: Google to Acquire AdMob for $750 Million

#16

Post by jfarmer »

alex_c wrote: post #10
tocomment wrote: post #8

The price seems kind of steep for something that puts ads in iPhone apps. Isn't the whole iPhone app marketplace worth a lot less than 750 million?

The whole mobile advertising market is probably not much bigger than this, but it's growing, and AdMob is the clear leader. I suspect AdMob would be worth a lot more than this in a couple of years if left to its own devices, which is the bet Google is making.

Eric Schmidt said at one point he thinks mobile advertising will be bigger than web advertising.

Re: Google to Acquire AdMob for $750 Million

#17

Post by zaidf »

unohoo wrote: post #13

Taking into account the admob and gizmo acquisitions, I cant help but admire google's acquisition strategy. Yes, they have made several acquisitions (dodgeball,jaiku etc.) only to shelve them later, but a lot of their acquisitions (doubleclick, analytics, admob) etc. are super strategic moves - compare this to yahoo's approach over the last few years, which acquired so many startups only to deadpool or offload majori…

Completely agree. Dodgeball/Jaiku and the likes are sooooper tiny compared to the ones that google has gotten right(YouTube/Urchin/doubleclick). Yahoo can learn leaps from them. I don't think enough can be said about how good Google's acquisition strategy is.

Re: Google to Acquire AdMob for $750 Million

#18

Post by xsmasher »

gustaf wrote: post #6
acgourley wrote: post #5

So obviously I don't understand this market at all, can someone explain to me why google couldn't just copy ad-mob's business practices and features?

Admob has a lock-in on the iPhone ecosystem that's hard to break.

Bingo. In order to beat admob you have to move their advertisers to your system (may be easy) and try to get app developers to run your ads instead of Admob's ads (hard).

It's a bit of a chicken-and-egg scenario (devs will not move until the advertisers are there, etc.) and much easier to just buy them outright.

Re: Google to Acquire AdMob for $750 Million

#19

Post by pbhjpbhj »

jsm386 wrote: post #3

Makes perfect sense. A year and a half ago Eric Schmidt said this: Schmidt cited the iPhone as the first mobile device with a good web browser and that more devices will come to market, enabling advertising to become personal, during an interview with the Frankfurter Allgemeine Zeitung. The CEO predicted that within a few years, mobile advertising would generate more revenue than advertising on today’s web. P.S. I wr…

I'd say any device running Opera was "the first mobile device with a good web browser".
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