updated 12:35 pm EDT, Fri May 21, 2010
FTC clears Google to take on Apple in mobile ads
The Federal Trade Commission on Friday approved Google's buyout of AdMob. The US agency unanimously decided that the takeover was "unlikely to harm competition" in mobile ads and specifically pointed to Apple's creation of iAd as proof competition would exist. Past strength wasn't necessarily an indication of the future, it said.
"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 going forward, whether AdMob is owned by Google or not," the FTC said.
Most of the justification came from the existence of rival smartphone platforms like BlackBerry, which give enough of an incentive for mobile ads to exist across multiple platforms. While Apple's iAd is iPhone-only, AdMob already targets most common smartphones.
Officials acknowledged that there were concerns about the competitiveness of the deal, which led to some developers feeling as though they were pressured to oppose it. Google and AdMob were portrayed as competing against each other and would have the advantage of sheer scale to outmuscle competitors. It's also unknown whether the two will be as innovative in mobile ads as they were while separate.
The FTC will monitor the space closely, according to the agency.
Apple may have inadvertently guaranteed that the AdMob deal would pass. CEO Steve Jobs previously acknowledged that Apple's buyout of mobile advertiser Quattro Wireless came after it missed an opportunity to buy AdMob. In creating iAd, it produced a competitor that otherwise wouldn't have existed, giving Google evidence it needed that it had strong competitors.