The Federal Trade Commission has been talking to Google about AdMob for several weeks and has issued a formal second request for information, Google said today.
Given Google’s dominance in search and the Obama administration’s heightened scrutiny of tech mergers, the FTC’s interest in AdMob is not a surprise.
Google had to wait nearly a year before federal regulators last year allowed it to acquire DoubleClick, which boosted Google’s ability to offer display ads. Also last year, Google abandoned its proposal to share search advertising revenue with Yahoo by running ads against Yahoo search queries after Microsoft and others complained and the Justice Department intervened.
AdMob would strengthen Google’s ability to offer ads on mobile devices, a market where no company dominates — yet. Google in November agreed to pay $750 million in stock for AdMob — 16 times the $46.8 million AdMob had raised in venture capital, one of the largest venture-backed deals this year — and the price raised eyebrows among some. Investment banker Linda Gridley called it a “bubble-like valuation.”
Google critic Scott Cleland argues that Google is trying to acquire a competitor in AdMob and would become a “gatekeeper” to the mobile world if the acquisition is allowed to go through. Others, including Google, disagree.
Google said today that it is cooperating closely with the FTC and is confident the acquisition will be approved, although it doesn’t say when. “We know that closer scrutiny has been one consequence of Google’s success,” the company said in a blog post.
