As Google outlines a smartphone strategy that puts the search giant in direct competition with Apple, the iPhone maker has struck a deal that may tread on Google's turf. Apple has acquired Quattro Wireless, according to a blog posting on Quattro's web site Tuesday.
The Wall Street Journal's D:All Things Digital blog valued the acquisition at $275 million. The move positions Apple as another hurdle in Google's moves to become the dominant player in mobile advertising.
Quattro Wireless is a global mobile-advertising company with a proprietary technology called Q Elevation. Built by a team of mobile and behavioral experts, the technology works to optimize every impression. This ad-serving, tracking and analytics platform has attracted a Fortune 500 client list that includes Microsoft, Proctor & Gamble, Viacom, BP and Disney.
Indeed, Quattro shows plenty of promise, raising nearly $30 million in venture capital from Highland Capital Partners and Globespace Capital Partners. The company's CEO, Andrew Miller, was named the Ernst & Young entrepreneur of the year 2009 in the emerging-company category in New England. In Tuesday's blog posting, Miller identified himself as a vice president of mobile advertising for Apple.
Miller reported that 2009 was a breakout year for the mobile-ad space and for Quattro. The company surpassed the four billion-impressions-per-month mark and revenue grew more than three times from 2008 as the publisher base swelled to thousands of mobile web sites and applications.
"With the forthcoming tablet and the iPhone becoming a larger part of Apple's business and the growing app ecosystem, the company may feel it needs to have some advertising apparatus to help support its developer network," said Greg Sterling, principal analyst at Sterling Market Intelligence. "Apple may want to provide a monetization option for developers who provide apps for the iPhone or the tablet."
Will Apple Compete with Google?
Apple's acquisition comes about two months after Google purchased Quattro competitor AdMob for $750 million in stock. At that time, Google painted a win-win portrait of the acquisition, noting it would enhance the company's expertise in mobile advertising and give advertisers and publishers more choice in this emerging market.
Neither Apple nor Quattro could immediately be reached for comment, but it appears that Apple, on some level, has decided to join Google, Microsoft, Yahoo and many others in jockeying for position in a mobile market that's projected to be worth billions in just a few years. Jupiter Research issued a recent report, Mobile Advertising: Delivery Channels, Business Models & Forecasts, that predicts the mobile-advertising market will grow to $5.7 billion by 2014.
But Sterling doesn't foresee an Apple-Google battle in the mobile-ad space. "I don't think Apple is going to suddenly come out as an advertising competitor for Google. I don't think that's where Apple necessarily wants to go -- but I do think Apple wanted to own a monetization capability," he said. "There are only a handful of mobile-ad networks, and Quattro is definitely one of the top players in the space. Apple may have wanted to grab it before it got snapped up."
Mike Kent contributed to this article.
Image credit: Product shot by Apple; iStock/Artist's concept.