Google is in early talks to pay $1 billion for India's InMobi, Reuters reported Wednesday morning.
Sources with direct knowledge of the situation have since told Business Insider that the deal isn't going to happen.
However, it certainly would have made an interesting acquisition.
InMobi is probably the single biggest mobile ad network company on the planet. Business Insider previously estimated its revenues at $372 million.
If Google bought it, it would solidify the search giant's domination of mobile advertising in an almost unassailable way. It would make Google No.1 for mobile ad revenues for years to come. Google's mobile ad business is already twice as big as that of its nearest competitor, Facebook, for instance.
Mobile is the future, and a Google + InMobi future would leave Facebook a distant second in terms of mobile media market share.
A Google-InMobi tie-up would also probably make Google the top player in "mobile app install ads." These ads, which simply drive people to the App Store of Google Play to download apps on their phones, have turned out to be a much larger advertising business than most people realize. BI Intelligence estimates nearly $7 billion will be spent on them in 2019.
It would probably attract the attention of regulators — and the complaints of Google's competitors — because Google's massive market share for mobile ads would be so overwhelming. Google already has 90% market share for search in some areas including Europe. It is already the biggest mobile ad company on the planet, with revenues in the billions (the company doesn't break out its mobile sales numbers).
InMobi, under CEO Naveen Tewari, has taken $220.6 million in funding and has about 900 employees.
Tewari told Business Insider in 2012 that his company served a staggering 93.4 billion impressions monthly across the planet. That probably makes InMobi an even bigger player in mobile app advertising than Google's AdMob network is. Google bought AdMob for $750 million — so you can see that on a valuation basis InMobi is a step above even that.
InMobi had long been regarded as too big to acquire. We thought it would eventually stage some sort of IPO. Indeed, Tewari previously told Business Insider, "We think this could be a standalone company." Growth has been "so fast and so large, we're one of only a handful of players that exists in this space."
InMobi was founded in 2007 at the dawn of the smartphone advertising age.
One of the company's key early employees is Anne Frisbie, now InMobi's VP & general manager for global alliances. The former Goldman Sachs analyst's career reads like a history of the internet. Now based in San Francisco, Frisbie has worked at Zip2 (Tesla CEO Elon Musk's early "city guide" website company that was sold to Compaq for about $350 million), AltaVista (an old search engine that lost the search race to Google), Overture (also named GoTo, an early search ad company acquired by Yahoo for $1.6 billion), and of course Yahoo.
Frisbie is based in San Francisco, and she knows everyone in the mobile/adtech space. So it is likely that a Google buyout may have her fingerprints on it.
InMobi's investment backing — five rounds from just four investors dominated by Kleiner Perkins and Softbank — has enabled it to grow bigger than its competitors, such as Millennial Media, Twitter's MoPub, and Apple's iAd.
Business Insider previously ranked InMobi as the No. 2 pre-IPO adtech company on the planet, behind only Pinterest. That ranking includes all adtech companies, not just mobile ones:
