FTC unanimously approves Google's AdMob acquisition

The Federal Trade Commission unanimously approved Google's $750 million acquisition of mobile advertising network AdMob, determining the deal does not pose a threat to competition in the fast-growing mobile ad market. The FTC said it closed its investigation into the Google/AdMob deal after its initial antitrust concerns were overshadowed by recent developments in the mobile ad segment, most notably the forthcoming introduction of Apple's (NASDAQ:AAPL) iAd effort. The FTC added that a number of other firms appear to be building or acquiring smartphone platforms to better compete with Google and Apple, contending these companies would have a strong incentive to facilitate competition among mobile ad networks.

"As a result of Apple's entry (into the market), AdMob's success to date on the iPhone platform is unlikely to be an accurate predictor of AdMob's competitive significance going forward, whether AdMob is owned by Google or not," said the FTC in a statement, adding, "Though we have determined not to take action today, the commission will continue to monitor the mobile marketplace to ensure a competitive environment and to protect the interests of consumers."

In separate statements, both Google and AdMob said they will now move to close the acquisition within the next few weeks. "We'll then start work right away on bringing AdMob's and Google's teams and products together," wrote Google Vice President of Product Management Susan Wojckicki on The Official Google Blog.

The FTC's decision comes as a major surprise given that The Wall Street Journal previously reported both Google and AdMob expected the agency to block the deal over antitrust concerns. Citing multiple sources close to the situation, the Journal noted that the absence of a clear direction of inquiry by FTC investigators did not bode well for the merger, first announced in late 2009. "The federal government is looking for a way to discipline Google in some way, because of larger concerns about its search power on the Web," said one Journal source. "And this is where it looks like it will try to show that concern." Said another observer, "The FTC really wants to do this and is in search of a legal theory that it can win with."

Google CEO Eric Schmidt vowed the company would battle federal regulators if the AdMob deal was denied approval. "We're likely to fight very hard," Schmidt told Reuters earlier this week. "It's a very strategic acquisition for Google."

For more on the FTC's decision:
- read this release 

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