Googleopoly V — Why the FTC Should Block Google-AdMob

December 16, 2009

 

Below is the abstract of my latest white paper in my five-part “Googleopoly” series of antitrust white papers. The full white paper is at this link and at www.googleopoly.net.

 

Googleopoly V* — Why the FTC Should Block Google-AdMob

The Top Ten Reasons Why Google-AdMob Would “Substantially Lessen Competition”

 

By Scott Cleland,** President, Precursor LLC

December 16, 2009

 

Abstract: A Google acquisition of AdMob would eliminate Google’s only substantial rival platform in mobile in-application advertising and catapult Google from an estimated 25% share to over 75% share of this strategic gatekeeper market for monetizing mobile Internet applications. Combined with Google’s search advertising monopoly and dominance of mobile search advertising, Google’s acquisition of AdMob, “the world’s largest mobile advertising marketplace,” would likely tip the broader mobile advertising marketplace from a competitive to a monopoly trajectory. In short, the AdMob acquisition threatens to foreclose competition and facilitate monopoly in a strategic gatekeeper market essential to the Internet economy, which would harm: consumers, developers, advertisers, publishers, smart-phone manufacturers, and broadband providers.

 

The Top Ten Reasons Why Google-AdMob Would “Substantially Lessen Competition:”

  1. Google-AdMob would combine the #1 & #2 mobile in-application display advertisers in a highly-concentrated and exceptionally-strategic gatekeeper market, effectively eliminating Google’s only substantial rival competitive platform in this market.
  2. Acquiring AdMob’s ~50% share would catapult Google to >75% share of the mobile in-application display advertising market.
  3. Preserving competition in this market is key to preserving a competitive mobile ecosystem.
  4. Google-AdMob would tip mobile advertising toward a monopoly trajectory.
  5. The extraordinary price paid for AdMob is evidence of acquisition of market power.
  6. Google proactively thwarted Apple from becoming a stronger competitor to Google.
  7. Déjà vu: DOJ’s Google-YouTube approval proved that antitrust enforcers need to be much more aware of the extraordinary network effects of adding fast-growing, first-mover strategic platforms to firms with existing market power.
  8. Google misled the FTC in the FTC’s Google-DoubleClick investigation by representing Yahoo as a viable long-term competitor when the two firms were exceptionally close and cooperative as evidenced by the proposed and rejected Google-Yahoo ad agreement.
  9. Google-AdMob could snuff out potential mobile application monetization competition in the crib.
  10. AdMob would enable Google to further dominate the collection of data and sensitive competitive information that is central to competing in the monetization of Internet content in the mobile or PC stationary markets.

 

*Googleopoly IV: How Google Extends Search Monopoly to Monopsony over Digital Info 9-15-09

Googleopoly III: Dependency: The Crux of Google-Yahoo Ad Agreement 10-3-08

Googleopoly II: Google’s Predatory Playbook to Thwart Competition; 9-23-08 

Googleopoly: The Google-DoubleClick Anti-Competitive Case; 9-17-07  

See www.Googleopoly.net

 

**The views expressed in this white paper are solely the author’s and not the views of any Precursor clients. See Scott Cleland’s Full Biography at: http://www.precursor.com/bio_long.htm

 

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