Google – Game changer or change of gears?

Google AdMob
Google acquired AdMob for $750million

What Google’s acquisition of AdMob means to the mobile advertising industry

While the valuation given to Admob by Google may be surprisingly high (for a company with maybe $40-$50m in annual revenues) the fact of the acquisition surprises no-one.

It’s a great achievement for Admob, showing what a dedicated team pioneering an idea in a “hot” sector can achieve.

It further underlines Google’s belief that mobile advertising….in fact mobile per se….is where the future action lies.

It shows that mobile M&A activity is healthy and deals are being done (EA announced its acquisition of Playfish on the same day).

But it’s not a game changer. All of the ad network and ad technology Google is acquiring through this deal has always been on their roadmap, but now they’ve shifted-up a gear in the race to market dominance in mobile advertising. It’s like the Whacky Races – now Dick Dastardly has Mutley on the team and is hot on the heels of Peter Perfect and Penelope Pitstop (you can do the substitutions…!).

It is ominous for small ad networks. They will have a much tougher job maintaining their publisher networks and their ad serving and sales functions will come under increasing pressure. The “800 pound” gorilla has beefed-up some more.

It will keep the (other) big guys on their toes. Microsoft and Nokia will reflect on how little they’ve really achieved from their earlier acquisitions of mobile ad players. Yahoo already knows all about the importance of winning in the mobile marketing and monetization space. The race to build-out and dominate mobile ad networks has lost a little more of its “whackiness” and become much more serious.

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