Google to Prompt Other Mobile Ads Networks Buys

Posted by: Olga Kharif on November 23, 2009

Even post its recent acquisition of AdMob, Google is far from dominant in mobile ads, though it does control the largest, 24% slice of the market, according to a Nov. 23 report from consultant IDC. Google and AdMob should report $68 million in mobile ad revenue this year, IDC estimates. But Millennial Media, with its $51 million in sales, is nipping at Google’s heels. And Yahoo and Microsoft are firing on all cylinders in mobile ads as well.

Chances are, Google’s acquisition will prompt additional purchases by its competitors, and they won’t come cheap. “….both Yahoo! and Microsoft cannot afford to not also acquire either Millennial Media or Quattro Wireless, given that Google and AdMob’s combined revenue will be more than twice that of Yahoo!’s and three times that of Microsoft’s,” writes analyst Karsten Weide. “The problem for both Yahoo! and Microsoft is that Google’s valuation of AdMob of at least ten times 2009 worldwide revenue, more likely significantly more than that, will set Millennial’s and Quattro’s expectations: They could expect valuations of at least $550 million and $400 million, respectively.”

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Reader Comments

mobiThinking

November 24, 2009 05:54 AM

Do mobile ad networks report revenues? I believe IDC’s revenue shares are estimates, based on estimated ad impressions multiplied by estimated costs of advertising (pretty tricky). So, while IDC has done a commendable job, no one can say with any certainty what the market share really is.
Also are we assuming that all mobile ad networks are the same or that business model less relevant than market share?
When you study them, they’re quite different – not just in geographical coverage, but also in business model. AdMob is a blind network – i.e. mass market. Millennial and Quattro still do a fair amount of blind advertising but are much more focused on premium publishers and advertisers. Microsoft – you know they’ve already bought a mobile ad network (Third Screen Media back in 2007)? – I believe doesn’t do any blind advertising.
If you want to know more about the different mobile ad networks, I recommend this guide: http://www.mobithinking.com/mobile-ad-network-guide

J-Mobile

November 24, 2009 10:43 PM

AOL' Advertising.com division bought Third Screen Media in 2007.

mike

November 29, 2009 11:09 AM

The problem for both Yahoo! and Microsoft is that Google’s valuation of AdMob of at least ten times 2009 worldwide revenue.
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BusinessWeek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, Douglas MacMillan, and Spencer Ante dig behind the headlines to analyze what’s really happening throughout the world of technology. One of the first mainstream media tech blogs, Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.

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