Commentary

Is Google's Mobile Future Golden?

Google gold

Google's proposed $750 million acquisition of AdMob looks at first glance like a move sure to extend its online ad dominance to the mobile realm. But Google isn't the first major Internet player to gobble up a mobile ad network to gain an early advantage in the space. In 2007, AOL bought Third Screen Media and Microsoft acquired European-based mobile ad company Screen Tonic.

As with Google's bid for AdMob, analysts hailed the Third Screen purchase as a validation of mobile marketing efforts. But neither the Third Screen or Screen Tonic deals have made AOL or Microsoft the giants of mobile advertising. In the case of Third Screen, the departures of key executives including founder and CEO Tom Burgess following the acquisition probably didn't help the company sustain momentum.

"You have to find a way of keeping key personnel at these companies or finding people who are roughly as capable," noted Roger Entner, senior vice president and head of research and insights for the telecom practice at the Nielsen Company. "AOL bought Third Screen Media and everyone left."

Both Google and AdMob have assured that won' t happen following the closing of their deal. "Attracting the world's top engineering talent and people with entrepreneurial vision to Google has always been crucial to our success," said Vic Gundotra, Vice President of Engineering at Google.

And for his part, AdMob founder and CEO Omar Hamoui in a blog post yesterday wrote: "The best part of all this is what's next. We are not going away." Time will bear out whether he keeps that promise.

Entner said he expects the Google-AdMob deal more of the big traditional Web companies to pursue mobile acquisitions to keep pace. But he stressed that simply snapping up a promising mobile startup doesn't guarantee success. "You have to execute very well," he said. "[Mobile] is a vibrant, ongoing engagement, so you have to keep working at it."

3 comments about "Is Google's Mobile Future Golden? ".
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  1. Howie Goldfarb from Blue Star Strategic Marketing, November 10, 2009 at 5:19 p.m.

    Typical Google. They are great at creating technology but not so great buying it. Considering how well You Tube has become an advertising hit. It should be a subscription service! Consider how Doubleclick is blocked from running on my Firefox browser and millions of other browsers. Nevermind the pitiful click through rates and amount of click fraud. Bravo to the Admob owners who cashed out. Ad serving is not in my opinion as good a business model as content (see Hulu) or technology (see Apple I Phone). People do not want ads randomly served to their phones and when the tablets take off we then able to have traditional websites, but mobile. Which will diminish Admobs mobile revenue stream. Two very important trends jeopardize Admob....the tablet computer that will surf the web and allow TV anywhere, and the pay for content movement. Mr. Murdoch just said he would rather have fewer people reading the Journal via paid subscription and no ads, than free viewing with ads. BTW My business is mobile advertising so I am not anti-mobile, but I am anti mobile that is not 100% opt-in.

  2. Nelson Yuen from Stereotypical Mid Sized Services Corp., November 11, 2009 at 3:54 p.m.

    I swear, every comment I read from Media Post includes a dinosaur's take on technology and business...

    Dinosaurs love to tout how content should be payed for by the people who consume it...

    Where is your logic? There is a social paradigm shift in how people consume information. Please realize that. Click through rates are pitiful because people are USED to ignoring marketing messages.

    Isn't Hulu free btw??? And don't they serve ads in between videos? I mean, what exactly do you DEFINE as the business model behind the IPhone and Hulu???

    The examples don't even MAKE SENSE. How do you compare an ad model to the sale of an IPhone?

    Do you really think people are willing to pay for content? I'm really starting to get agitated with 60+ geriatrics trying to dictate how the rest of the world should consume content. TABLET COMPUTER? I don't think you understand cloud computing or the direction technology is taking in the LEAST.

    Please. I beg of you to invest in Mr. Murdoch's ideas. Please feel free to lose your shirts, and your social security checks...

  3. Nelson Yuen from Stereotypical Mid Sized Services Corp., November 11, 2009 at 3:55 p.m.

    AND BTW, DoubleClick's ads are blocked from running on your Mozilla browser. Just the standard video ads!!!!

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