AdMob Buys AdWhirl Wanting To Dominate Further

AdMob has been growing steadily since its inception, dominating iPhone app advertising and getting closer to dominating mobile ads in general.

In a step to further its dominance, the ad network acquired AdWhirl- a competing mobile ad network – after controversy surrounding a move by AdMob to stop allowing other ad networks to deliver its ads as part of a multi-network service.

AdMob claims the reason for this move stemmed from user-complaints over broken ads and technical issues, but its obvious that the company was tired of splitting revenue when it could presumably be keeping 50% of the profits.  AdWhirl, along with others, where profiting greatly by serving AdMob-based ads-  With the shut-off, third-party ad networks where effectively left in the dark.

Looking at the larger picture- any ad network that can gain access to iPhone app developers can corner the market in a big way.  AdMob, for a long time, was doing just that.  Recently, however, other networks such as AdWhirl were coming on strong with those same app developers by offering them an ad exchange.

This method allows mobile app developers to switch from AdMob to other competing mobile ad networks such as Quattro, VideoEgg, or Mobclix on the fly.  Although it launched only last April, AdWhirl was quickly becoming the preferred advertising interface for many developers because they could still serve AdMob ads through it, but not be tied to AdMob if a better deal came along.

This scared AdMob greatly, which had been enjoying Google-like dominance for a long time.  It’s first move was to stop allowing ad exchange interfaces, like AdWhirl, from serving ads from its inventory.  App developers quickly called them out on it and AdMob retreated.  AdMob definitely doesn’t want to upset app developers in any way, simply because of the fact that they’re the reason they’ve seen so much success.

The next logical move by AdMob was to simply acquire AdWhirl, which they did shortly thereafter.

After the dust settles though, what will AdMob/AdWhirl do to calm those who believe AdMob will simply funnel more of its own ads through AdWhirl now that it controls it.  It could also track all of the ad impression data of its competitors to improve its own ad products, making it even more unfair to competitors.

To be fair, AdMob has reiterated several times that it will open-source the underlying code of AdWhirl for more transparency, but it still leaves a lot of questions un-answered.  AdMob is undoubtedly trying to keep its corner of the market to itself, but it will be increasingly harder to do so in the near future.