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Why/how did Google outbid Apple for AdMob? Schmidt: Google Apple not "primary competitors"
Submitted by Scott Cleland on Mon, 2009-12-14 13:54
Recent revelations indicate that the seriousness of the FTC's antitrust investigation of Google's proposed acquisition of AdMob will be ramping up.
Only eight months ago, Google CEO Eric Schmidt claimed Google and Apple were not "primary competitors" when a shareholder asked Mr. Schmidt to step down from Apple's board, because of an FTC antitrust investigation of Google for engaging in anti-competitive interlocking directorates per an AP story.
While everyone is distracted by the front-page news of Google launching its own Google-manufactured smartphone called Nexus One, what I find most interesting is that Google outbid Apple for AdMob by paying an exceptionally-high "multiple of up to ~16.7 times sales, the sort of price rarely seen in takeover deals since the heady days of the dot-com boom" per Reuters reports.
The Wall Street Journal also reported some very interesting new information/insights relevant to the FTC's Google-AdMob investigation:
The question FTC antitrust enforcers and Apple should want answered is: "What did Mr. Schmidt know and when did he know it?"
Given the FTC's ongoing investigation of Google-Apple interlocking directorates, its current preliminary investigation of Google's proposed acquisition of AdMob, and recent reports of Apple's serious interest in acquiring AdMob, the FTC appears to have a legal obligation to conduct a second request with civil investigative demands (CIDs or subpoenas) to determine if Mr. Schmidt's Apple board seat conferred Google any confidential and/or improper inside knowledge/information to enable Google to foreclose competition from Apple in mobile advertising?
The Google-AdMob plot thickens.