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Evidence FTC Tipped Google to Mobile Ad Dominance
Submitted by Scott Cleland on Wed, 2012-03-14 18:39
New evidence indicates that the FTC's lax Google antitrust enforcement -- in approving Google's acquisition of AdMob with no conditions in 2009, despite FTC staff recommendations to block it as monopolistic -- have enabled Google to extend its dominance of PC search and advertising into mobile search and advertising.
In 2010 when approving Google-AdMob, the FTC said: "although the combination of the two leading mobile advertising networks raised serious antitrust issues, the agency’s concerns ultimately were overshadowed by recent developments in the market, most notably a move by Apple Computer Inc. – the maker of the iPhone – to launch its own, competing mobile ad network."
The FTC also said about Google-Admob: "…evidence gathered by the agency raised important questions about the transaction. Google and AdMob have competed head-to-head for the past few years, with a notable increase in intensity during the past year. This competition has spurred innovation and allowed mobile publishers to keep a large share of the revenue generated from the sale of their ad space. The companies also have economies of scale that give them a major advantage over smaller rivals in the business, the statement says."
Given the news that Apple has been subpoenaed by the FTC on Google mobile search, the subpoena likely is exploring in part if Google misrepresented in anyway the competitive facts or implications of Apple's entry into mobile advertising in order to persuade the FTC commissioners to overrule the staff recommendation to block the transaction.
The other most likely line of inquiry in the Apple subpoena or "civil investigative demand," is the deal Google offered in 2007 to be the default search provider for the iPhone in 2007 and the iPad in 2010.
Eight long months after first subpoenaing Google in June 2011, it is welcome news the FTC is finally beginning to subpoena competitors who know where many of Google's proverbial bodies are buried.