I have been looking forward to a big Google-Apple brawl which I'm sure is only going to get more nasty. It looks like it's escalating quite rapidly, with AllThingsD reporting that Apple is set to announce its own ad platform.

This would make things very interesting between Google and Apple. Google clearly is dominant in the online advertising space, but needs to make more inroads. That's why it is in the process of buying Admob, a transaction which is being reviewed by the Federal Trade Commission (FTC). Apple, on the other hand, clearly has a dominant mobile platform and thinks it would be nice to roll up some advertising with that to beat Google at its own game.

AllThingsD's Peter Kafka points out that when Apple announces an ad platform, it will be difficult for the FTC to argue that Google is building a monopoly, especially when Apple is so powerful in the mobile space:

Why would Google applaud the entrance of a new advertising rival? Because Google is trying to convince federal regulators that it has advertising rivals so that it can proceed with its $750 million purchase of AdMob. That deal is being held up for review by the Federal Trade Commission, and there have been consistent murmurs from Washington that the purchase could be in jeopardy.

Apple’s plan to get into mobile advertising has been apparent since early January when the company purchased Quattro Wireless for $275 million. Like AdMob, Quattro specializes in ads that run within apps. That’s a tiny market now, but it’s expected to grow along with the booming app economy, pushed by the mobile platforms Apple (AAPL) and Google (GOOG) are promoting.

All the more evidence that the companies are headed for a gigantic collisions in the mobile space. Google is ramping up its Android mobile operating system and will be on a lot more phones by the end of the year. These two companies are going to be going head-to-head in the online advertising space.