Google’s AdMob buy earlier this month made the search firm the largest mobile ad network available today, with 24% of mobile ad network share. AdMob competitors Millennial Media and Quattro Wireless, which have 18% and 7% market share, respectively, are looking more and more to be prime buys for the likes of Microsoft and Yahoo.
Market research firm IDC came up with the above market share figures based on Google and AdMob’s combined 2009 mobile ad revenue of $68 million. Yahoo comes in second, with 11% market share and mobile ad revenue totaling $32 million in 2009. Microsoft comes in third, with 8% market share at $23 million.
IDC’s view is that Yahoo and Microsoft need to buy their own mobile ad networks to remain competitive with Google, and I agree. IDC analyst Karsten Wiede points out that the $750M buy of AdMob raises the prices for competitors, which makes it more difficult for Microsoft and Yahoo to buy. There are no Black Friday discounts in the tech world.
“Both Yahoo and Microsoft cannot afford to not also acquire either Millennial Media or Quattro Wireless, given that Google and Admob’s combined revenue will be more than twice that of Yahoo’s and three times that of Microsoft’s,” write Wiede in a research note.
IDC estimates that Millennial could be bought for around $550 million and Quattro would be worth about $400 million in a deal.