Google Grabs AdMob To Push Further Into Mobile Advertising

[Posted by Neil Strother]

Google has just announced an all-stock deal to purchase mobile ad network AdMob for $750 million in a bid to solidify its position as the leader in mobile advertising.

By acquiring AdMob, the search giant gets a mobile ad network that has leveraged the power of the mobile Web and in-app advertising, particularly on the iPhone. Now, as more people adopt devices that mimic the iPhone experience (Androids, of course, as well as BlackBerrys, Palms, etc.), Google stands to gain from a growing audience that will be increasingly attractive to advertisers.

The deal also signals a shift in the landscape, and it will be interesting to see how competitors like Microsoft, Millennial Media, Quattro Wireless, among others, respond.

Big picture: mobile advertising remains a small fraction of the overall interactive marketing spend (see our forecast report if you are a Forrester client). Google, however, expects mobile to be a key growth driver in the coming years, and the acquisition of AdMob plays right into that strategy.

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