Google buys a lot of stuff. They have the money to do that. And when they buy stuff, it doesn’t always turn out to be worth the hefty asking price. Fortunately, our beloved Android sits on the other end of that spectrum. Speaking at the Stanford Accel Symposium, Google’s David Lawee – vice president of corporate development – called the acquisition of Android their “best deal ever.”
He admits there was skepticism after dotting the final I’s and crossing the last T’s, but the reported $50 million they spent to acquire Andy Rubin’s corporation proved to be a tremendous success. We just heard that Google’s expected to make $1 billion from their AdMob-assisted mobile strategy in the next year alone.
That would mean their initial investment of $750 million would come right back around, and then some. By 2014 – when analysts expect Android to be the number 1 operating system in the world – that $10 billion per year goal might just become the reality that Google wants it to become.
After acquiring AdMob, Google’s Android strategy has shifted from “revenue through search” to “revenue through apps.” (It would be more accurate to say these two are working in conjunction, though.) There are now over 100,000 applications in the Android market, to date, and more developers are beginning to use ads in order to offset poor sales of paid versions of their offerings.
And now we see why developer mindshare is just as important to Google as any other part of the equation. AdMob – being the defacto platform for serving up ads in Android apps – enables Google to take a fast-growing software-driven ecosystem and turn it into cold, hard cash.
[via Venture Beat]