Inside Google

More concerns about Google’s $750 million proposed deal to buy mobile advertising company AdMob were raised Tuesday.

Sen. Herb Kohl (D-WI) wrote Jonathan Leibowitz, chairman of the Federal Trade Commission, warning that the proposed deal “raises important competition issues which should be reviewed carefully and with close scrutiny by the Federal Trade Commission. ”

You may recall that Consumer Watchdog and the Center for Digital Democracy joined in opposing the Google/AdMob deal after it was announced.

The Senator’s letter continued:

“The importance of this transaction is heightened because of the likely importance of the smart phone advertising market in the future.   Sales of smart phones are undergoing explosive growth.    Consumers are increasingly using these phones to search the Internet and to make use of the applications downloaded onto these devices.    Smart phones are a uniquely powerful method for advertisers to reach consumers, because most consumers with smart phones carry them most of the day, and frequently use them to access and search the Internet.  Many industry experts expect more Internet searches to be done on smart phones than on PCs in the next five to ten years and that mobile advertising on smart phones will become a dominant advertising medium …

“I recognize that advertising on mobile devices, and on applications running on these devices, is a new and nascent market with business models in the process of developing.   While antitrust regulators need to be cautious with respect to transactions affecting such a market, at the same time antitrust authorities should not allow harm to competition that may substantially harm competition in its incipiency.   The stakes are very high in protecting a fully competitive market in this increasingly important sector of the high tech economy.  Thus the incipiency of the smart phone advertising market is not in itself a reason for the FTC to desist from taking any necessary action to enforce the antitrust laws or protect competition should it determine such action is necessary.    Ensuring a vibrant and competitive mobile device advertising marketplace should be a top priority for the FTC as it considers this deal.

I’d say that Sen. Kohl’s comments are spot on.  And with recent reports that the FTC has been taking sworn statements about the mobile market from companies, signs are that the FTC is likely to listen.

PHOTO CREDIT <a href=”http://www.flickr.com/photos/stuckincustoms/”>Stuck in Customs</a>