Google to acquire AdMob for $750 million

Updated at 9:53 a.m. PST with additional details. See subsequent story for more analysis on the buy.

Google's back on the acquisition front, spending $750 million in stock Monday to acquire mobile display ad company AdMob.

AdMob founder Omar Hamoui

(Credit: AdMob)

AdMob is perhaps best known for serving display ads on iPhones, but it also recently started a business unit focused on ads for Android phones. The start-up would appear to fit well into Google's advertising business model, giving Google a leg up in the still-small but fast-growing world of mobile advertising.

"I'm excited because I believe this will be an important moment for everyone involved in producing, consuming, or monetizing engaging products on mobile," wrote AdMob founder and CEO Omar Hamoui in a blog post Monday. "The truth is that the mobile industry has had no shortage of creative energy, amazing products, and talented entrepreneurs. But until now, it has always felt like those of us involved in this space played second fiddle to our online brethren. I believe that time is over."

AdMob was founded in 2006. The company runs its Mobile Advertising Network across thousands of Web sites, serving up ads from big names such as Ford and Coca-Cola. It also collects and publishes data on mobile trends gleaned from the traffic it manages.

"Despite the tremendous growth in mobile usage and the substantial investment by many businesses in the space, the mobile Web is still in its early stages," wrote Google's Susan Wojcicki, vice president of product management, and Vic Gundotra, vice president of engineering, in Google's own blog post. "We believe that great mobile advertising products can encourage even more growth in the mobile ecosystem. That's what has us excited about this deal."

Representatives from Google and AdMob are expected to talk about the deal in greater detail later on Monday. This is a friendly takeover, as both companies have already approved the deal, they said in a press release.

It should come as no surprise that Google is back in a buying mood, after several weeks of talk from CEO Eric Schmidt and other company executives about Google's renewed prospects now that the company believes the worst of the advertising recession is past. At $750 million, the acquisition would rank as one of Google's largest deals, trailing DoubleClick at $3.1 billion and YouTube at $1.6 billion but edging out Postini's $625 million selling price.

Google's stock was up 1.81 percent to $561 on news of the deal.

[Super2online]

This is just Google trying to leverage it's ad cash cow they already have.

[krosafcheg]

Guess what, no I don't want to be bugged by ads on my iphone, bb, etc. These executives seem to overlook that every freakin pixel on a small screen is expensive real estate. ..cluttering it with ads will only annoy and disenfranchise users of the ads being served to them. Backfire should be the new name of the company.

makes sense with new android phones coming out. they own all screens

[Neumenon]

Right.

We need more exposure to advertising, and google should monopolize that.

F#$% them.

[Mr. Dee]

The one trick pony is going far and wide.

[wirelesscaller]

Does android use mozilla and if not is the browser capable of plug ins? I guess ad block plus will be boon for all mobile users if available.