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Google's overwhelming dominance in search is proving to be a hindrance in other areas of its business. Like mobile, where the search giant's $750 million purchase of AdMob is rumored to get blocked by the Federal Trade Commission sometime this week.
Despite the fact that Google has not proven itself to dominate in any sector other than search, the company's reputation seems to precede its success in mobile. But blocking the Google-AdMob deal would be preemptive regulation at its worst. The mobile ad market is still anyone's game.
Google put a fire under the fledgling mobile ad industry with its AdMob purchase last year. Since then, Apple spent $275 million to purchase Quatro Wireless. And that landgrab was considered a counterpoint to Google's supposed mobile dominance as recently as last week.
But now it looks like the FTC is having none of Google and AdMob. According to AllThingsD:
“The federal government is looking for a way to discipline Google in some way, because of larger concerns about its search power on the Web,” said one source. “And this is where it looks like it will try to show that concern.”
But that makes no sense. The mobile ad market is estimated to be worth under $1 billion this year. Together, Google and Apple spent more on their acquisitions than the entire mobile ad market is worth right now. Why? Because mobile is set to explode. And it could grow in any number of directions.
Meanwhile, in the months that Google's mobile ad deal has been poured over by regulators, Apple has debuted the proprietary ad network iAd, where minimum annual ad buys are estimated to be in the ballpark of $1 million.
Considering the options available to mobile advertisers right now — from geolocation to interactive and banner advertising — the mobiel ad market is definitely still up for grabs.
AdMob may be the frontrunner in the mobile ad game, but there is no proof that together with Google it will dominate or — more importantly — prevent other businesses from thriving in the mobile market. Crippling Google's mobile acquisition because the company has a track record in search is simply misplaced aggression. And what for? Cutting Google out of mobile is just likely to give Apple more room to takeover in mobile. That hardly sounds like a solution to prevent a mobile ad monopoly.