Cellphone advertising
Right now over 61% of the World population uses a cell phone on a regular basis. That’s a staggering 4 Billion people walking around with a cell phone in their pocket every single day.
And the growth isn’t going to stop any time soon. The market just keeps getting bigger. Its possible to reach more people via their cell phone than any other media on the planet.
Despite Apple’s dominance of the mobile phone industry, the Apple iPhone only has an 11% Market Share in the Cell Phone Industry as of Q1 2009? What about the other 89% of the people? This figures are surprising.
The fast paced world of mobile phone media and advertising is one that cannot be ignored. In an attempt to move into the market very quickly Google bought AdMob, a major provider of mobile cellphone advertising for a staggering $750 million. This is Googles 3rd largest purchase ever. Admob provides the majority of ads on mobile networks.
The move also gives Google, whose Google Android Software is being used more widely in smartphones such as the Motorola’s new Droid, a key set of technologies to expand its advertising footprint beyond its signature text search ads. “Google could have built this itself, but this gives them a head start,” says mobile analyst Greg Sterling of Sterling Market Intelligence. “It will thrust Google into the forefront of mobile display ads.”
In particular, AdMob provides Google with the ability to serve display ads, the pictorial banners that are the chief revenue source for most Web sites, to cell phones and other mobile devices. Google last June introduced AdSense for Mobile in a bid to provide Web sites with display ads akin to its multibillion-dollar AdSense program for conventional Web sites.
Google said acquiring the team at AdMob, which employs about 140 people, was as important as the technology in accelerating Google’s mobile display ad efforts.
“We got a chance to get an unbelievable engineering team,” Vic Gundotra, a Google vice president of engineering, said in an interview. Susan Wojcicki, Google’s vice president of product management, added that AdMob founder Omar Hamoui is “really a visionary in this space.”
AdMob is regarded as one of Google’s large acquisitions, though the money involved is small next to Google’s $178 billion market capitalization. Besides DoubleClick, Google has paid more only for video sharing site YouTube, which it bought for $1.7 billion in 2006.
AdMob’s growth has attracted attention, though the privately held company doesn’t reveal revenues. BusinessWeek recently featured AdMob as one of 50 companies that could be the next Google.
Founded in January 2006, AdMob has some blue-chip customers such as Ford, Procter & Gamble, and Coca-Cola. It is probably the biggest mobile phone ad provider in the industry. It has raised $47.2 million in funding from Sequoia Capital, Accel Partners, DFJ Growth Fund, and Northgate Capital. AdMob claims on its Web site to have served more than 125 billion ad impressions.
The mobile phone ad industry is set to continue growing – its an unknown advertising medium and with Google acquiring one of the biggest ad networks it could easily become as big at the internet itself!
