The adtech and telco sectors continue to collide with the announcement that Norwegian mobile carrier Telenor has entered into an agreement to acquire one of the largest cross-device companies Tapad Inc for $360 million. As this news break ADTEKR looks at why these two companies have come together and what this means for the rise of the “ad-telco” as previously reported on ADTEKR, following the AOL Verizon deal last year.
The key players
Mobile carrier Telenor, listed on the Oslo Stock Exchange and based in Norway, has over 200 million mobile subscribers in 13 markets, operating not just in Scandinavia but across Eastern Europe and Asia. Meanwhile Tapad is a New York based cross-device start up co-founded in 2010 by two Norwegians, Are Traasdhal and Dag Liodden.
Tapad is a market leader in the U.S. delivering cross-device marketing technology solutions that give publishers, marketers and technology providers a unified interpretation of consumers across different devices and screens. The “Tapad Device Graph” is its innovative device management solution, which assimilates data points from different devices to help customers recognise and measure audiences.
Why this deal?
For Tapad this deal represents an opportunity to tap into Telenor’s Asian markets, where they currently do not have a presence. Tapad hope that the deal will allow them to scale internationally, which considering it has global clients such as Oracle on its client roster, is a logical next step for the company. Meanwhile, as TechCrunch reports, mobile carriers like Telenor are increasingly faced with pressure on their primary legacy offerings as basic data gets cheaper and they look to add more services on top of their networks to leverage subscriber bases. Sigve Brekke, CEO of Telenor, said in a statement:
With the acquisition of Tapad, Telenor … is taking a position within the rapidly growing market for advertising technology, and securing important competence within digital marketing and analytics. I believe significant value can be created from applying marketing technology to improve the digital capabilities of our core telecom business.
Exactly what form this will take is not yet clear although, at least initially, Tapad will remain an independent division of Telenor, with Telenor becoming “a very special customer”.
The rise of the ad-telco continues
This deal follows Verizon’s acquisition of AOL last year, which saw the first major ad-tech telco tie up take place. At the time it was reported to be an aggressive move by a telco into the digital ad monetisation space and many thought it would allow Verizon to compete with the likes of Google and Facebook.
Interestingly the industry has not yet seen the full force of the impact predicted at the time of the deal which is most likely due to the time it takes to fully synergise two companies and resolve issues around restructuring.
Despite this, and other any questions which might be floating around on the success of Verizon’s purchase, what this move from Telenor shows is that yet another carrier backs digital advertising as a fast growing market and that it values the enriched data that is now available. Following this endorsement, it is again likely we will see more tie ups between adtech and telco carries in the future, and concerns will no doubt be raised once again as to the impact this may have on the industry as “walled gardens” controlled by telcos rather than the open ad market, emerge.