Posted on August 28, 2009 at 10:23 AM
Filed under: Acquisitions | Best Practices | Corporate Strategy | Growth Strategy
Tagged: AdMob , AdWhirl , iPhone , Mobclix , Quattro , VideoEgg

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Cell phones are getting more powerful and interactive, which is fueling the growth of mobile advertising -- an industry prime for growth. And while San Mateo, Calif.-based AdMob Inc. rules the roost for now, its keeping an eye on competitors and just bought a rising star, AdWhirl, the April startup that lets iPhone developers tap into multiple ad networks. Basically, AdWhirl allows mobile developers to use AdMob or its competitors, such as Quattro, VideoEgg or Mobclix.

Mobile gaming Web site PocketGamer summed it up best: It's a classic case of a well funded incumbent buying a startup to gain control over a quickly developing market. The tech section of our sister blog Dealscape shows AdMob has raised more than $47 million in VC funding and also gives the interesting background story on how AdMob was born.

Making money with ads on free applications, or "apps," is proving worthwhile. AdWhirl showed numbers from May where it made $3,000 per day on "Sound Alert" and $5,000 per day from an unnamed app.

The flexibility of AdWhirl is why AdMob bought it. TechCrunch explains that AdWhirl is a mobile ad exchange, which allows mobile app developers to switch from AdMob to competing mobile ad networks. It also noted AdWhirl was quickly becoming the preferred advertising interface for many developers because they could still serve AdMob ads through it, but not be tied to AdMob if a better deal came along. TechCrunch also asks if anyone will trust AdWhirl now that AdMob has acquired it and may exert control over who gets first dibs on ads. We'll have to wait and see how developers react for that answer.

AdMob has a solid client list, including Ford Motor Co. (NYSE:F), Coca-Cola Co. (NYSE:KO), Electronic Arts Inc. (NASDAQ:ERTS), Procter & Gamble Co. (NYSE:PG), MTV Europe, Adidas AG and Paramount Pictures, as well as "publishers that are pushing the boundaries of the mobile web" like AccuWeather, CBS Mobile, Flirtomatic, TinyTube and others.

AdMob says it serves billions of targeted and personalized ads on the mobile Web each month. It will get some help fueling those numbers as China Unicom Ltd. struck a deal to sell Apple Inc.'s (NASDAQ:AAPL) iPhone in China. - Baz Hiralal

Go to the story
See the acquisition announcement
Also see: AdMob raises $12.5M from DFJ, Northgate



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