Is Google Gearing Up To Buy A Second Mobile Ad Network?


Google (NSDQ: GOOG) may be paying $750 million in stock for AdMob, but even once the acquisition closes, it will continue to have a significant hole in its mobile advertising offerings.

That’s because neither Google or AdMob have the ability to insert an ad into a text message — at least on a large scale. The coverage gap is actually pointed out by Google itself on a site that explains the acquisition in detail. In an illustration, Google highlights how it is focused on mobile search and how AdMob is focused on display. But under the picture of an ad sent by SMS, neither company is listed.

So, the question is, is Google preparing for a second mobile advertising acquisition? A Google spokesperson did not reply to an email seeking comment, but it may not be a bad idea. SMS is something almost all phones are capable of doing, and today it still makes up 55 percent of the mobile advertising market, according to eMarketer. Contrast that to mobile search, which makes up 20 percent and display ads, which make up 25 percent. Those figures are no surprise to Google, which posted them today as part of the acquisition.

The list of companies in that space that could be potential candidates for Google or others include: 4INFO, HipCricket, Cellfire, SinglePoint, *iLoop Mobile* and VeriSign.


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Jeff Judge

@"response to r et al": The title of the article is "Is Google Gearing Up To Buy A Second Mobile Ad Network?", not "Is Google Gearing Up To Buy A Messaging Aggregator?". How does being a tier 1 aggregator equal acquisition target by Google in relation to advertising? There are only a handful of aggregation companies that have direct binds to the tier1 carriers in the US (4INFO not being one of them). My comment was around the advertising value that 4INFO would bring to the table, not message aggregation. Google could care less about direct binds to the carriers, if they did they just court the carriers directly. Focus: the article is about SMS advertising not competitive strength with aggregation and a campaign management product.

response to r et al

it's clear a lot of the commenters here don't know much or if they do they are trying to paint a different picture probably for their own gain. This wont be achieved through comments, folks. There are two significant differences here: those with binds with those without. Next, there are those with solutions that are actually in work for real clients and then there are those with a press release. Satisfy those two and you have a real solution.


Both Openmarket and Singlepoint have SMS 'ad exchanges' in various stages of implementation however the problem is they are still 'selling' their SMS messaging to clients instead of offering free ad supported messaging gateway. What this means is that they are still charging SMS alert providers .01 to .02 per message and then offering to ad support them with a payout of .01. This means you still hold the bag for unfilled inventory. Also you cannot even think of making money until you hit the million message per month volume price points.

My prediction is that nothing big is going to happen to the SMS ad insertion market until the aggregator monopoly on connectivity are replaced by open API's from the carriers.

Eld Olagor

Here is why I don't think SMS advertising is an interesting category for Google to get into.
1) there is already a glut of inventory (mobile PVs).
2) SMS is not conducive to rich forms of advertising.
3) You have to deal with operators and their unique per operator anomalies = not scalable

Instead there are much more interesting in opportunities in mobile local and mobile shopping scenarios which we will see Google go after.

Tricia Duryee

@JeffJudge: I agree with you. I think 4INFO would probably be the best fit, too. Plus, I didn't notice this at first, but the text alert used as an example by Google in the picture is an actual short code from 4INFO.

Just pointing out the coincidence….

Jeff Judge

I was thinking that graphic pointed that out as well, but most of the companies included in that graphic don't actually do a significant amount of SMS advertising – HipCricket and iLoop are focused on mobile campaign management which sometimes includes an ad. VeriSign is a messaging aggregator similar to OpenMarket, mBlox, Motricity, etc). 4INFO would probably the best fit for Google given their focus on alerts (sport scores, etc), media client base and ad network – but I would think Google has plenty of experience with SMS given their own amount of traffic and existing text-based ad capabilities.

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