Yesterday, Google announced their acquisition of Admob on the Google blog.

Admob, a dominant player in the mobile advertising arena, was founded in 2006 after Omar Hamoui couldn’t find ways to generate traffic to his mobile site.  As a solution to this problem, the Admob platform was developed. Since then, Hamoui and his team have grown Admob into a thriving and innovative mobile advertising company.  With this merger Google is aggressively entering the mobile advertising market and as a result of this acquisition Google will dominate the mobile advertising arena with approximately 30% – 40% of the market share.

According to Google mobile revenue is their fastest growing revenue stream. This can, in part, be attributed to the introduction of smart phones with advanced Internet browsers.  Google states that their mobile search requests have increased more than five times over the past two years.

The partnership between Google and Admob will result in increased advertising in applications on smart phones such as the iPhone and others that run on Android.  Within applications these ads are typically displayed as a banner at the top or bottom of the screen.

Admob’s publisher network is made up of more than 15 000 mobile websites and applications and according to Admob they received 2.6-billion ad requests from iPhone and iPod Touch devices in September 2009, up from 130-million in September 2008.  Even though Google has been displaying text ads on mobile search results it hasn’t had much success with mobile web display ads or in-app ads – until now.