Home Mobile Industry Reaction: Apple Buys Mobile Ad Network Quattro Wireless

Industry Reaction: Apple Buys Mobile Ad Network Quattro Wireless


Reaction: Apple Buys Qauttro WirelessToday, the mobile ad network gravy train proved it has plenty of steam left in the engine as Apple bought Quattro Wireless for $275 million in a story first broken by All Things D’s Kara Swisher.

The prediction by Morgan Stanley’s Mary Meeker that 2010 Internet trends will be led by Mobile appears correct – at least through the the first week of January!

AdExchanger.com asked several members of the advertising ecosystem about their thoughts on the acquisition and its broader implications for advertising.

James Kiernan, SVP at MediaVest WorldWide, told AdExchanger.com:

“Since this represents one of Apple’s first moves in the advertising arena, I think companies will be very interested to learn how Quattro can support their mobile strategy and potentially pave the way for a larger partnership with Apple across other fronts.”

Tim Hanlon, Managing Director of Riverview Lane Associates and former MD of Publicis/Vivaki Ventures arm said:

The acquisition “shows that mobile computing – smartphones, ebooks/readers, tablets – is real and now. While it may be unclear how ‘advertising’ and marketing plays out, it’s pretty clear who will influence its development: Apple and Google. It will be interesting to see how Microsoft responds given their relative weakness in the space – make a run for RIMM, perhaps?”

Analysts Bill Morrison and Robert Coolbrith of ThinkEquity saw a change in competitive set for Google:

“We see this as an interesting reminder of evolving competitive sets in online advertising, commerce and entertainment. In our view, it’s a sign that Google’s foremost competitors over the long run may not be Microsoft or Yahoo!, but Apple and Amazon.”

MediaMath CEO Joe Zawadzki said:


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“Apple buying Quattro, coming off an ‘enforced ad attention routine’ patent, is very interesting. I think there’s a 95% chance it’s a bad idea for Apple – off brand promise, a distraction from what they are really good at, etc. – and their foray into advertising will end with a whimper. There’s a 5% chance it’s a brilliant idea, and Apple will revolutionize this market as they have done consumer electronics and music. The luxury and the curse of being a $193 billion dollar company is that you have to make some pretty speculative bets to ‘move the needle’. $275MM for a mobile advertising play seems not outlandish in that context.

Perhaps more interesting is the secular trend here … Adobe buying Omniture, Cisco announcing an ad exchange and investing in Quantcast, Akamai acquiring Acerno, Apple with Quattro. Lots of non-traditional advertising players are getting into the advertising business. Turnabout is fair play I suppose, as Google, a traditional advertising company works to convert the huge market cap and cash balance it’s generated to diversify into other businesses – OS, browser, smartphones, local content, etc. The next 5 years is going to be really fun.”

Peter Farago, VP of Marketing at mobile analytics firm Flurry, said:

“When Admob was no longer available, Apple simply looked to the number two ad network, Quattro, who also has a strong publisher network. Ultimately, the bigger game being played here is around the battle for 3rd party application developer support. The number and quality of applications available in each respective app store is critically important to sell more handsets and retain consumers. Apple knows this better than any company, from the PC vs. Mac battles of the 80s and 90s.”

Scott Jones, CEO of mobile couponer, Cha-Cha, said its all more mobile momentum:

“Important, big players like Apple and Google are realizing the potential of advertisers shifting their ad spend to mobile devices. Obviously, the explosive trend in media is mobile. And, it’s clear that free apps and services will predominate over paid apps and services. Clearly, the best way to monetize is via advertisers, who are figuring out that they should make mobile a significant part of their advertising budget. Interestingly, both AdMob and Quattro focus nearly exclusively on “smart phones”, which is a growing segment but still represents less than 20% of mobile phones in users’ hands. Smart advertisers are committing more dollars to mobile advertising in all its forms, including text, voice, and the mobile web.”

What do you think?

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