News

Adtech startup Unlockd goes into administration following Google threats

Local adtech startup Unlockd has gone into administration, claiming Google’s attempts to ban the company from its mobile advertising platforms has crippled the business.

Unlockd displays ads on smartphone lock screens in return for users receiving loyalty rewards. It suffered a blow in April, shortly before its planned IPO, when Google threatened to ban the service, claiming it was in breach of its Play Store and AdMob services’ terms and conditions.

The Unlockd team faces an uncertain future after the company went into administration today

In May, Unlockd won an injunction in the UK High Court preventing Google from banning the service, however the company expressed disappointment at the limited scope of the UK ruling.

In today’s announcement, the company said that despite wins in the UK and Australian courts, Google’s actions had scared off investors which prevented Unlockd from raising further capital.

Since being founded in 2015, the company has raised $68m from investors including Lachlan Murdoch, former Seven Group CEO Peter Gammell and Catch of the Day founders Hezi and Gabby Leibovich.

As the service only operated on the Android platform, a ban from Google could have been fatal for the company.

A Google spokesperson told Mumbrella at the time of the original ban that: “Our publicly available AdMob and Google Play policies clearly set out how our products may be used, and are designed to protect the interests of advertisers, publishers and phone users.”

Commenting on the status of the company’s legal action against Google, an Unlockd spokesperson told Mumbrella: “Our legal course of action remains, however, we will now also consider our options in relation to damages against Google”

Google has been contacted for comment.

The Unlockd announcement in full:

Following an unanticipated threat from Google earlier this year to remove Unlockd’s apps from the Google Play Store ecosystem and deny access to its ad  server Admob, Unlockd was forced to place its planned ASX IPO on hold and take a stand to protect the business, shareholders, partners and importantly 330,000 monthly users to whom this action would cause irreparable harm and disruption.

We have since received significant judgements from both the English High Court and the Federal Court of Australia granting Unlockd interim injunctions to prevent Google from disabling AdMob-generated advertising content and removing Unlockd apps from the Google Play Store in the UK, Europe and Australia. This was recognition by the Courts
that there is a serious issue to be tried.

Despite this, the ramifications of Google’s actions have had and continue to have a deep impact on the business when considering the valuation of Unlockd prior to these threats and the postponement of the planned IPO, which would have fueled the continued growth and expansion of the business. As such, we have not been able to secure the capital we had expected to replace the IPO and therefore have been left no choice but to move into voluntary administration.

Unlockd launched in 2016 with a clear vision to change the way people use and pay with their digital devices. It is now a revolutionary platform that is fundamentally changing the way that people interact with the world of advertising, by returning value to users in exchange for their attention in a way that Google and other big tech companies do not. We believe that Google’s conduct and the effect of its actions represents a further example by them of anti-competitive conduct toward innovative start-ups such as Unlockd, that might pose a future threat to their position in the market.

Until wide reaching change is brought about to prevent companies like Google from abusing their dominant market positions, consumers and innovation will continue to suffer.

Unlockd’s Board of Directors and management are now working with administrators to decide on the best path forward for the business and continue to assess current discussions regarding investment and potential acquisition.

ADVERTISEMENT

SUBSCRIBE

Sign up to our free daily update to get the latest in media and marketing