Google CEO credits Apple's iAd for boosting AdMob deal

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With the Federal Trade Commission reportedly assembling an internal litigation team to mount an antitrust challenge to Google's proposed $750 million acquisition of mobile advertising network AdMob, Google CEO Eric Schmidt is citing rival Apple's new iAd mobile ad effort as evidence the segment remains competitive. Fielding questions after a Sunday speech in front of the American Society of News Editors, Schmidt called iAd "evidence of a highly competitive market," adding: "It just seems obvious to me. I hope [the AdMob acquisition] gets approved."

Citing sources familiar with the matter, The Wall Street Journal reported last week the FTC sent letters to AdMob's competitors requesting sworn statements about the potential impact of the deal, and briefed Congress about its concerns over the acquisition. The Journal added that FTC staffers have not yet made a final decision to block the AdMob acquisition, however, and its five commissioners have not voted on the issue. In addition, Sen. Herb Kohl (D-Wis.)--chairman of the Senate subcommittee on antitrust--sent a letter to the FTC on Tuesday, urging the agency to carefully scrutinize the AdMob acquisition and arguing that it "raises important competition issues."

A mobile application developer interviewed by FTC attorneys told Reuters that FTC staffers have been canvassing the developer community as the agency assembles its case against the AdMob purchase. "Its been really interesting talking to them because they are so dead set against this," the developer said, requesting anonymity. "They have been clearly positioning to try to stop this."

iAd, announced last week in conjunction with Apple's new iPhone OS 4.0, will allow iPhone application developers to insert interactive, rich media advertisements into their apps and share in resulting revenues. For selling and hosting the ads, Apple said it will keep 40 percent of the revenues generated from ads, pushing the remaining 60 percent to developers. Apple currently retains 30 percent of the revenues generated from iPhone application sales through its App Store.

For more on Schmidt's iAd comments:
- read this Reuters article

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