Did Apple meet with mobile advertising company, AdMob before Google acquired them last week for $750 million? That’s what “people familiar with the matter” told Bloomberg:
Buying AdMob would have allowed Apple to expand into online advertising, a strategy that Nokia Oyj is pursuing, [IDC analyst Karsten Weide] said. “If a lot of traffic goes through my devices, why can’t I become the middleman that serves ads against that inventory? AdMob would have allowed them to do that quickly.”
Clearly advertising isn’t a core Apple business the way it is for Google, but then again with Google getting into so many of Apple’s core businesses (smartphone OS with Android and now desktop OS with ChromeOS), Apple could be looking to give them a dose of their own expansion. Given that Apple recently filed a patent for an ad-supported version of Mac OS X (something Microsoft explored years ago for Windows), they could also be looking for alternate ways to subsidize the cost of their platforms going forward. Right now carriers like AT&T foot the advance for the iPhone (and theoretically might do the same for an iTablet or 3G-connected MacBook) but the more options to reduce up-front consumer costs, the better — especially in the increasingly competitive landscape.
We’ve said before Apple should have snapped up Grand Central before it became Google Voice, is Cupertino growing slow to react, or is Google just hitting warp speed?
When Google opens their wallet, big buyouts follow, and this time it’s iPhone/mobile advertising company AdMob for $750 million, and VoIP startup Gizmo5 for about $30 million.
AdMob is an obvious choice for Google, as it’s built mobile and in-app advertising (especially on the iPhone) into a $100 million a year business, enough to get Brin and Page personally involved in the courtship. Says TechCrunch:
Google is gunning hard to dominate mobile Web advertising and AdMob has an early foothold in the display side. [...] Google’s purchase price tells us it thinks the opportunity for mobile display ads is in the billions of dollars, at the very least.
Gizmo5, rather than advertising, could help round out Google’s services portfolio. Again, TechCrunch has the details:
Google Talk allows voice calls between users but has no PSTN link to allow incoming or outbound calls to real phones. Gizmo5 does this well already. [...] And Google Voice is a great VoIP and phone identity service, but they have no endpoint for calls. Gizmo5, which by the way already integrates with Google Voice, is a soft phone end point for Google phone users.
Of course, Apple will have to stop considering/reverse the rejection of Google Voice, or Google will have to deliver that killer web app version, before iPhone users benefit from that…
Last week we linked to an AdMob estimate that the iPhone and iPod touch App Store could represent a $2.5 billion a year economy, which based the estimate off usage stats for their mobile ad network, and a survey of 1000 iPhone, iPod touch, and Google Android users. But not so fast, says Cult of Mac along with developers from Polar Bear Farms, App Cubby, and the Yankee Group.
$2.4 billion divided by the 65,000 apps in the App Store is $37,000 per app, per year. And while some developers earn that, many do not.
They figure it’s closer to $250 million to $500 million, or roughly one fifth to one tenth the size.
AdMob is sticking to their original numbers, however, according to the methodology shared again with GigaOm.
To us, it just seems like they’re all guestimating how big that really, really big pie is — just stupid, or goram ridiculous.
[Thanks Icebike for the tip!]
Does the App Store represent a $2.5 billion a year economy, with 26.4 million iPhone users, 50% of whom pay for apps to the tune of $9.49 a month, or $125 million in August alone? That’s the story AdMob’s latest figures (via GigaOm) are telling, with 26.4 million iPod touch users, at 40% who pay, averaging $9.79 or $73 million rounding out Apple’s mobile platform.
Some other interesting metrics include iPhone users downloading 10 new apps a month, 18 for iPod touch. 8 apps are freebies for the iPhone’rs, 16 for iPod touch’ies.
Any wonder everyone and their carrier is trying to get into the App Store game?
[Via Gartenberg]
