On Monday AT&T confirmed its battle to compete with Verizon, Google and Facebook for digital ad dollars with the acquisition of AppNexus for $1.6 billion. And while it is a mere pittance compared with the $85.4 billion it spent to gobble up Time Warner earlier this month, the buy will certainly put the company on more even footing when competing with the other powerhouses in the ad-tech space.
AT&T said it will sell ads by combining AT&T’s first-party data, premium video content and distribution.
With the billion-dollar acquisition, AT&T wades into ad tech, said Jason Downie, Lotame’s chief strategy officer. “Verizon, Salesforce and Oracle are all in the game, but this is the biggest acquisition in the space to date,” he said.
The entrance of another Fortune 10 company into the ad-tech space dramatically changes the game, Downie said.
AppNexus helps to deliver the content with the ads.
“This acquisition is great for the programmatic advertising industry, as it will accelerate the trend of OTT/CTV inventory being monetized using programmatic technology, specifically with real time bidding,” said Frost Prioleau, CEO and co-founder of Simpli.fi, a demand-side platform focusing on local programmatic advertising.
Prioleau called AppNexus an “excellent fit,” and said the acquisition of Time Warner now brings the company “a ton of quality content.”
“AppNexus, as one of the leading exchanges, will help them monetize both their own content as well as content from other publishers,” Prioleau said.
A long list of financial powerhouses have supported AppNexus throughout the years, whether or not it changed hands. WPP Group in 2014 acquired a 15% stake in AppNexus. At the time the ad tech company was valued at $1.2 billion, according to the Financial Times.
Brian O’Kelley, a former chief technology officer at Right Media, founded the company, which Yahoo picked up for $850 million in 2007.