Report: Apple Snaps Up Quattro Wireless, Joins the Mobile Advertising Business

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After Google acquired mobile advertising network AdMob in November for $750 million, the chief marketing officer at Waltham, MA-based Quattro Wireless, an AdMob rival, told me Quattro wasn’t worried about having Google as a competitor. “We actually think [the Google-AdMob deal is] great for the industry, because it really shows the importance of the mobile advertising market, and how important it is for advertisers and publishers to have access to mobile specialists,” said Quattro’s Lynn Tornabene.

As it turns out, Quattro executives may have known they had their own ace in the hole. Kara Swisher of the Wall Street Journal‘s AllThingsD blog reported last night that Quattro is being acquired by Apple of Cupertino, CA. According to Swisher’s sources, Apple is paying $275 million for the startup, which has raised about $28 million in venture backing from Highland Capital Partners of Lexington, MA, and Globespan Capital Partners of Boston.

Swisher reported that an announcement about the deal might be forthcoming today, but so far there’s been no official word of the alleged acquisition. Tornabene did not immediately reply to my request for confirmation and comment.

Quattro, which has doubled in size from 70 employees to about 150 in the last year, is in the business of helping major consumer brands create and place advertisements that are specialized for mobile platforms such as smart phones. Companies such as Coca-Cola, Ford, Netflix, and Kmart use the company’s ad network to place promotions that can range from banner ads in mobile website to entire mobile microsites and even dedicated mobile applications.

Apple’s iPhone and iPod Touch devices are a major venue for Quattro’s clients—in fact, “iPhone” and “Apple” are the two most-used tags within Quattro’s company blog. If Apple is in fact acquiring the company, it’s probably for the same reason that Google bought AdMob. Both companies want a share of the growing advertising revenues being generated via their mobile platforms (Android phones in Google’s case).

The reported Quattro acquisition would, for the first time, make Apple a direct broker of mobile advertising. Given Apple’s mixed track record of success working with developers of third-party iPhone apps—there’s a widely held perception that the company’s process for vetting mobile apps is slow and arbitrary—it’s unclear how advertisers who want to reach consumers through mobile channels will feel about being dependent on Apple for ad placement.

The Boston Globe‘s Scott Kirsner is reporting this morning, based on a conversation with a source close to Quattro, that the Apple deal closed in 2009 and that Quattro CEO Andy Miller will report directly to Apple CEO Steve Jobs. Both Miller and Quattro chief technology officer Eswar Priyadarshan are alumni of m-Qube, a Boston-based mobile marketing company acquired by VeriSign for $250 million in 2006.

Wade Roush is a contributing editor at Xconomy. Follow @wroush

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