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Apple met with AdMob weeks before acquisition by Google

post #1 of 28
Thread Starter 
Apple reportedly approached mobile-ad king AdMob weeks before Google's $750 million dollar takeover of the company.

Sources close to the matter confirmed to Bloomberg that Apple contacted AdMob Inc. "a few weeks" before it accepted a $750 million dollar offer from Google. Spokespersons from Apple, Google, and AdMob, all declined to comment on the subject. The nature and extent of the contact between Apple and AdMob is unknown as of now.

AdMob is one of the largest sellers of advertisements on the iPhone, placing ads in many popular free apps such as Yelp and Tap Tap.

With the purchase of AdMob, Google has become the Internet's largest mobile advertising company. Google now has a dominant advertising presence on both the iPhone and Android platforms.

Google's CEO Eric Schmidt said in an earlier interview with Bloomberg, "AdMob is clearly the best of its ilk for applications monetization." Schmidt acknowledged that one of the iPhone's great accomplishments is the sheer number of apps which are available, especially those that are free and ad-supported.

Google had an already large footprint on the iPhone with its native Maps and YouTube applications, along with downloadable apps Google Mobile and Google Earth. Apple and Google have not always seen eye-to-eye over the platform, especially regarding the Google Voice application. Apple's rejection of the app prompted a Federal Communications Commission investigation into the matter.
post #2 of 28
Hard to believe that Apple would be involved with a possible acquisition of AdMob, or bidding against Google for that matter, considering they've never stepped into that arena before.
post #3 of 28
Quote:
Originally Posted by str1f3 View Post

Hard to believe that Apple would be involved with a possible acquisition of AdMob, or bidding against Google for that matter, considering they've never stepped into that arena before.

Since there is no indication that Apple was interested in acquiring AdMob, perhaps their discussions were of a different nature, such as some sort of licensing deal.
post #4 of 28
Quote:
Originally Posted by dualie View Post

Since there is no indication that Apple was interested in acquiring AdMob, perhaps their discussions were of a different nature, such as some sort of licensing deal.

Perhaps. But with everything going mobile and the likes of os systems like Suns looking glass, who knows, maybe google will one day have an OS.

The GV mobile is an extraordinary App.
post #5 of 28
Quote:
Originally Posted by str1f3 View Post

Hard to believe that Apple would be involved with a possible acquisition of AdMob, or bidding against Google for that matter, considering they've never stepped into that arena before.

Or, they were making the AdMob guys feel a bit more wanted, and hence pricier.... a bit of payback.... maybe.
post #6 of 28
Sorry Apple you couldof been a contendah.
post #7 of 28
Quote:
Originally Posted by str1f3 View Post

Hard to believe that Apple would be involved with a possible acquisition of AdMob, or bidding against Google for that matter, considering they've never stepped into that arena before.

What's that supposed to mean? How is that any different then when Apple acquired Casssady & Greenes Soundjam and renamed it iTunes. There were never involved in music prior either. Same thing.
post #8 of 28
Quote:
Originally Posted by hiimamac View Post

Perhaps. But with everything going mobile and the likes of os systems like Suns looking glass, who knows, maybe google will one day have an OS.

The GV mobile is an extraordinary App.

Google already has 2 OSes. Android and Chrome OS.

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post #9 of 28
.

Consider that free apps are subsidized by Apple, bandwidth, distribution, etc. Paid for (up front or by in app purchases) Apple gets paid, via AdMob/Google they are simply getting a free vehicle to burden users with advertising so Apple needs to look at how they can cover the overheads and earn a fair return rather than giving it away.

Apple seems to be drawn in to the world of advertising reluctantly and when they are add another dimension, I suspect that Apple has gained a higher proportion of plaudits for its advertising than any other company. People are suckers for advertising, somehow they think they get something for free but in reality the cost of time and energy is a fraction of the benefit gained. Buy an hour of TV from Apple, it costs $1.99 and saves 15 minutes wasted watching adverts, is that a great deal or what? Still people are suckers for 'free'.

I hate advertising, wastes my time, mostly all it sells is shit. People tell me about good things they have experienced, honestly, that's rare in advertising. I can investigate if I feel so inclined. I investigate anyway as a matter of course including sources where real people speak what they think, like AppleInsider.

Apple + AdMob, I doubt it was/is what most people think, especially the analcysts and pundits who tend to have very narrow viewpoints. Ads have become an important developers funding method on iPhone/Touch so Apple needs to react, a point I made months if not years ago.

Apple should take 30% of the ad revenue to level the playing field, that would also encourage developers to make apps devoid of adverts for minimal charges, a dollar or few. How Apple gets 30% remains a tough question, Apple could not have simply bought out AdMob and taken their cut because the 'Apple is a monopolist' crowd would burst forth again with renewed venom.

.
post #10 of 28
Don't forget that Apple recently applied for a patent for a "novel" method to serve ads to a computer operating system. Food for thought.
post #11 of 28
Nobody trusts Apple from a partnering or coporate standard.

Apple burns every bridge (partnership) it has had since day 1.

Apple can't continue to do it alone and the future of mobile and web is advertising.

If they were even in consideration for this particular deal they would have been passed up given their track history.

Apple can't do it alone for too long. Yes they are a leader right now but they have every industry fighting their arrogance.

Google is no better but consumers and companies trust them. You have the beginnings of the new Microsoft with more power than they ever imagined.

Edit.
If Apple was considered and they passed on it they would be like Microsoft 20 years ago saying browsers and search results aren't important.

But hey, it was a victory for Apple this week. They beat Psystar and have forever linked themselves to be a gaming phone and MP3 Player. Android just has free Google Apps (Google Voice and Google Latitude) and GPS turn by turn voice built into Android OS.

Good luck paying Google for all the ads built into the Apps that Apple "Chooses" to Approve. Love the iFart Apps that Apple has become so known for approving. Now you even have them in paid Apps. Google gets paid either way.

This person hit the nail right on Apple's head. Beauty of the Bath (no idea what the name means but he/she is correct).
Quote:
Consider that free apps are subsidized by Apple, bandwidth, distribution, etc. Paid for (up front or by in app purchases) Apple gets paid, via AdMob/Google they are simply getting a free vehicle to burden users with advertising so Apple needs to look at how they can cover the overheads and earn a fair return rather than giving it away.
post #12 of 28
Yes - ad supported apps are clearly "getting around" the App Store model Apple intended. Their model was that they would take a % of the sale price to pay for hosting etc, but these guys are selling for free and then collecting ad revenue, so Apple gets nothing.

Perhaps Apple is thinking of changing the App Store developer agreement to ensure they get part of the ad revenue, or that the only ad service that can be used is Apple's own. And perhaps they intended to buy AdMob and turn it in to their own service.

Apple should definitely be getting compensated somehow.
post #13 of 28
I wonder if this a direct result of Mr. Schmidt being a Apple board member for as long as he was...
post #14 of 28
Quote:
Originally Posted by Dave K. View Post

I wonder if this a direct result of Mr. Schmidt being a Apple board member for as long as he was...

I wondered this, too. Not from the standpoint of Google out maneuvering Apple, but Apple still working with Google closely despite Schmidt not being on the board to assist each other in crushing the competition. Apple has never been in advertising before and I think it would be bad form to sell the HW, control the OS, and the ads running on it.
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post #15 of 28
Quote:
Originally Posted by str1f3 View Post

Hard to believe that Apple would be involved with a possible acquisition of AdMob, or bidding against Google for that matter, considering they've never stepped into that arena before.

I'm going to say there was never a chance of this happening, Apple could have contacted AdMob for a million reasons.
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post #16 of 28
Quote:
Originally Posted by solipsism View Post

I wondered this, too. Not from the standpoint of Google out maneuvering Apple, but Apple still working with Google closely despite Schmidt not being on the board to assist each other in crushing the competition. Apple has never been in advertising before and I think it would be bad form to sell the HW, control the OS, and the ads running on it.

Not knowing much about....having read the article that was my first thought, too. It's kind of something akin to adding the trial crapware on a new PC.
post #17 of 28
It could have had something to do with this:

http://www.nytimes.com/2009/11/15/bu...WzROeq+Tj0BhNw
post #18 of 28
Quote:
Originally Posted by melgross View Post

It could have had something to do with this:

http://www.nytimes.com/2009/11/15/bu...WzROeq+Tj0BhNw

That could be a complementary technology to what Google just bought. It could also be a technology that allows Apple to be the gate keeper on advertising on their platforms. The gate keeper needs to be paid a toll of course.
post #19 of 28
Quote:
Originally Posted by MacTel View Post

That could be a complementary technology to what Google just bought. It could also be a technology that allows Apple to be the gate keeper on advertising on their platforms. The gate keeper needs to be paid a toll of course.

As they say in the article, this is by no means a definite thing on Apple's part.

Sometimes a company will work on technology and receive patents so that others can't get it and use it agains them. They're called "defensive patents". No guarantee that's the case here either.
post #20 of 28
Quote:
Originally Posted by melgross View Post

It could have had something to do with this:

http://www.nytimes.com/2009/11/15/bu...WzROeq+Tj0BhNw

Interesting article. Although it is a little breathless in parts, I agree with Randall Stross's larger thesis. I do find it odd - and I hope there is no chance - that Apple is interested in something so potentially in-your-face.
post #21 of 28
Quote:
Originally Posted by melgross View Post

As they say in the article, this is by no means a definite thing on Apple's part.

Sometimes a company will work on technology and receive patents so that others can't get it and use it agains them. They're called "defensive patents". No guarantee that's the case here either.

Yeah. I hope it's one of those times.
post #22 of 28
Quote:
Originally Posted by str1f3 View Post

Hard to believe that Apple would be involved with a possible acquisition of AdMob, or bidding against Google for that matter, considering they've never stepped into that arena before.

They have filed a patent related to ads in an operating system though.

http://appft.uspto.gov/netacgi/nph-P...RS=20090265214

Perhaps this was where the discussions were heading...
post #23 of 28
Quote:
Originally Posted by melgross View Post

As they say in the article, this is by no means a definite thing on Apple's part.

Sometimes a company will work on technology and receive patents so that others can't get it and use it agains them. They're called "defensive patents". No guarantee that's the case here either.

It's unfortunate. The whole premise of the patent system is to protect inventions so they can profitably exploited. In my world such patents would be invalidated if there was no real prospect they were going to be used by the patentee.
post #24 of 28
Quote:
Originally Posted by djsherly View Post

It's unfortunate. The whole premise of the patent system is to protect inventions so they can profitably exploited. In my world such patents would be invalidated if there was no real prospect they were going to be used by the patentee.

2009 is a lot different than the 1780's.

Back then, like was simple. Technology was just beginning to move up. Inventions were simple by today's standards. Almost anyone could invent something, because almost nothing had been invented.

The only companies back then were trading companies or small manufacturing concerns that made items the way they had been made for centuries, with simple tools.

Today, as far as important industries are concerned, almost anything needs to be invented by teams of people, millions of dollars of research, many millions more of development, and years of time to bring it to market. Most inventions are so complex that few people out of the field can even understand them.

Unfortunately, that means that the entire process has become so complex that one seemingly minor thing can bring entire industries to their knees. Because of that, companies have to research entire areas they may not want to employ themselves, but that others may want to employ against them.

It's unfortunate, but its part of the "modern" world of technology. There's no turning back.
post #25 of 28
Quote:
Originally Posted by Beauty of Bath View Post

Consider that free apps are subsidized by Apple, bandwidth, distribution, etc. Paid for (up front or by in app purchases) Apple gets paid, via AdMob/Google they are simply getting a free vehicle to burden users with advertising so Apple needs to look at how they can cover the overheads and earn a fair return rather than giving it away.

Oh please, let's cut through the redirect. Apple clearly benefits from free apps.

First, it builds consumer goodwill since everybody likes to get free stuff. Consumer goodwill then leads to people recommending that product to friends and family and thus becomes a form of free advertisement. And some percentage of those recommendations will lead to sales for Apple.

Second, it builds consumer lock-in. If a user begins accustomed to using some of these free apps, they will think twice about switching phones. Thus Apple will continue to get revenue from AT&T for that phone.

Despite what you're trying to imply, it's more of a symbiotic relationship than the parasitic relationship you want to portray it as.
post #26 of 28
Quote:
Originally Posted by caliminius View Post

First, it builds consumer goodwill since everybody likes to get free stuff. Consumer goodwill then leads to people recommending that product to friends and family and thus becomes a form of free advertisement. And some percentage of those recommendations will lead to sales for Apple.

Imagine all the goodwill Apple could get if they gave all their stuff away for free, like free iPhones, free Macs, and free OS X.
post #27 of 28
This is for the best, Apple doesn't need this right now...

I think Google has some Apple envy, let's face it, Google has been doing a lot more of going into Apple's turf then the other way around...
post #28 of 28
Quote:
Originally Posted by MrCompMan View Post

Nobody trusts Apple from a partnering or coporate standard.

Apple burns every bridge (partnership) it has had since day 1.

Apple can't continue to do it alone and the future of mobile and web is advertising.

If they were even in consideration for this particular deal they would have been passed up given their track history.

Apple can't do it alone for too long. Yes they are a leader right now but they have every industry fighting their arrogance.

Google is no better but consumers and companies trust them. You have the beginnings of the new Microsoft with more power than they ever imagined.

Edit.
If Apple was considered and they passed on it they would be like Microsoft 20 years ago saying browsers and search results aren't important.

But hey, it was a victory for Apple this week. They beat Psystar and have forever linked themselves to be a gaming phone and MP3 Player. Android just has free Google Apps (Google Voice and Google Latitude) and GPS turn by turn voice built into Android OS.

Good luck paying Google for all the ads built into the Apps that Apple "Chooses" to Approve. Love the iFart Apps that Apple has become so known for approving. Now you even have them in paid Apps. Google gets paid either way.

This person hit the nail right on Apple's head. Beauty of the Bath (no idea what the name means but he/she is correct).

Gee, people used to say the same thing about Microsoft. :-) The difference is that Microsoft's management just liked crushing people for sport. If you are referring to partnerships like the Motorola ROKR, well Apple saw how well that went and decided they could do better. Your iPhone is the result of that. The Apple-Google partnership began going south when Google got into the smartphone business, which I think Apple might have a point at being a little miffed.

I'm sure that AdMob went to anyone they thought could potentially give them a good price for their company and that list is very small. Apple is an obvious choice since they provide ad dollars for most ad-based iPhone apps. And Apple could easily write the check for them from petty cash. But selling ads is not Apple's core business, nor have they expressed any interest in getting into the business. The relationship is Google is getting weird enough as it is and Apple's developers who are already chafing about the App Store approval process might not want to deal with Apple again for the ad business. It also goes against Apple's strategy of paying a little amount of money for businesses they feel have multiples of upside.

Google, on the other hand, wants to own every part of the ad business, especially in businesses clearly growing. It's their core business (not search) and they know it very well. AdMob also will be a major player in the Android store and Android developers don't have the same apprehension as Apple developers have to the process.
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