Apps, Ads, and Antitrust: A Retrospective on Google’s Purchase of AdMob

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Justin Bernick, Logan Breed, May 28, 2014

Google announced its acquisition of AdMob in November 2009 when the “mobile revolution” had just begun. Since then mobile device use has exploded. One in five people worldwide now own a smartphone, and more people worldwide now own a smartphone than a personal computer. The number of software applications developed for mobile devices has also skyrocketed, increasing from about 100,000 in 2009 to about one million today in the Apple App Store alone. Over 50 billion apps have been downloaded from the Apple App Store, and another 50 billion apps have been downloaded from Google Play.

App developers “monetize” their apps in many ways, one of which is advertising. AdMob was one of several startup mobile advertising networks. After Google announced its acquisition of AdMob, the Federal Trade Commission began an investigation to assess whether the transaction would eliminate competition between the companies, resulting in too much market concentration. But the mobile industry shifted even as the FTC’s investigation was pending. In January 2010 Apple announced its $275 million acquisition of Quattro Wireless, another startup in-app advertising network that Apple subsequently rebranded iAd. The FTC closed its investigation in May 2010, noting that Apple’s entry and other developments made AdMob’s historical success an “[in]accurate predictor of AdMob’s competitive significance g…

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