Google is making a big move into mobile advertising with the announcement today that it is acquiring San Mateo, Calif.-based AdMob for $750 million in stock.

The move certainly will be closely watched in Redmond, where Microsoft has its own mobile advertising efforts. Seattle upstarts such as Medio also have been trying to carve territory in the emerging category.

"Despite the tremendous growth in mobile usage and the substantial investment by many businesses in the space, the mobile web is still in its early stages," Google wrote in a blog post. "We believe that great mobile advertising products can encourage even more growth in the mobile ecosystem. That's what has us excited about this deal."

It marks the third largest acquisition in Google's history, following deals for DoubleClick and YouTube.

To date, Google has mainly focused on mobile search ads. But with the pending acquisition of AdMob it will add strength in mobile display advertising.

In fact, mobile display advertising was one of the core areas of expertise that Microsoft picked up through its acquisition of Paris-based ScreenTonic two years ago.

More on the deal from AdMob founder Omar Hamoui in this blog post in which he writes:

"We now operate in an environment that is much more advanced than the one we entered into a few years ago. There are literally hundreds of competitors, small and large, with different areas of focus and expertise. Lately, it seems that almost every week we hear about a new idea or company in the mobile advertising space. This has led to rapid innovation, and we're excited about the positive attention this deal will bring to mobile advertising. We have no doubt this will bring even more players into the space and accelerate all the innovation that is already taking place."

Meanwhile, Read Write Web offers an interesting analysis on the deal, noting that Google didn't want to see a third party player like AdMob become the dominant distributor of advertising on Android phones.

Meanwhile, Google also reportedly is buying voice over Internet startup Gizmo5 for $30 million in cash. Google CEO Eric Schmidt said recently that the search giant plans to look to M&A deals now that the recession is ending.