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Antitrust regulators clear Google's purchase of AdMob

May 21, 2010 | 10:56 am

The Federal Trade Commission unanimously approved Google Inc.’s $750-million acquisition of AdMob Inc., clearing the way for the Internet giant to accelerate its push into mobile advertising.

The FTC said it examined but ultimately rejected claims that the merger would harm competition in the nascent market for advertising on mobile devices. The FTC delayed its decision on the deal to examine Apple Inc.’s push into mobile advertising with its iAd program that places ads on its hand-held devices. 

Ultimately it decided that Apple would raise the level of competition. In January, Apple bought Quattro Wireless, an AdMob rival.

The FTC said the combination of Google and AdMob raised serious antitrust issues but that recent developments overshadowed those issues.

The move represents a major shift for regulators who had signaled they were prepared to block Google’s acquisition of AdMob. The FTC staff had recommended challenging the deal but legal experts say regulators would have had a hard time showing Google would dominate a market that is still in its infancy.

“As a result of Apple’s entry into the market, AdMob’s success to date on the iPhone platform is unlikely to be an accurate predictor of AdMob’s competitive significance,” the FTC said in a statement Friday.

Analysts had downplayed the possibility that Google’s purchase of AdMob would hand the Internet giant an unfair advantage. Karsten Weide, analyst with researcher IDC in San Mateo, Calif., estimated that Google and AdMob together had 21% of the U.S. market in 2009.

“As mobile phone usage increases, growth in mobile advertising is only going to accelerate,” Susan Wojcicki, Google’s vice president of product management, wrote in a blog post. “This benefits mobile developers and publishers who will get better advertising solutions, marketers who will find new ways to reach consumers, and users who will get better ads and more free content.”

Omar Hamoui, AdMob founder and chief executive, said he was pleased with the decision. “Our focus is now on working with the Google team to quickly close the deal,” he said.

-- Jessica Guynn

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