Google to acquire ad firm AdMob

In a bid to expand its footprint in the mobile advertising marketplace, Google is acquiring mobile ad firm AdMob.

Founded in 2006, AdMob is a focused on selling and serving display ads on mobile browsers. However much of its recent growth has come from mobile applications - an area where iPhone and iPod Touch devices dominate. In its first three years, the company has worked with thousands of advertisers to serve mobile ads to more than 15,000 websites and applications.

In a statement, Google said the deal will help it improve targeting and tracking of campaigns; build more powerful optimization and publisher-side monetization tools; and increase mobile ad effectiveness by leveraging its own sales team. "Mobile advertising has enormous potential as a marketing medium and while this industry is still in the early stages of development, AdMob has already made exceptional progress in a very short time," said Susan Wojcicki, Google's VP of product management.

When it goes through, the $750 stock deal will be the third largest in Google's history, after its acquisitions of DoubleClick and YouTube. Google has lately indicated it will resume a more aggressive merger strategy, after scaling back M&A efforts in 2008 and 2009. The AdMob agreement appears to be the first step in that direction.

Additionally, AdMob is one of a very small club of ad networks that Google has attempted to acquire. In 2007 it bought FeedBurner, an RSS feed management platform that also operated as an ad network.

In the last year, AdMob has invested considerable resources on global expansion. In October 2008, the company raised $15.7 million in funding, and said it would use the money to seek new business in Western Europe, India, South Africa, and Japan.

Incidentally, AdMob's North America General Manager Jason Spero had recently remarked that applications on Google's Android platform had begun to surge in the company's ad traffic reports.