AT&T's latest buy helps it compete with Google, Facebook
If anyone ever doubted AT&T’s seriousness about competing with Google and Facebook for digital ad dollars, Monday's confirmation that it purchased AppNexus for $1.6 billion, one of the biggest digital ad platforms, should dispel those doubts.
The deal comes shortly after AT&T closed its $85.4 billion acquisition of Time Warner — a move that AT&T has said will help open the door to selling highly lucrative ads by combining content with its distribution network.
The company confirmed the news in a press statement on Monday.
AppNexus provides the plumbing that helps pair online content with ads, offering tools to both content supplies and ad buyers through tis platform.
When consumers open an application, a complex auction occurs with advertisers bidding to serve their ads to that consumer. AppNexus picks the winner in a fraction of a second and takes a slice of the revenue. The firm also helps advertisers figure out how effective its campaigns are.
AppNexus competes with Google's DoubleClick Ad Exchange. Back in 2016, the New York-based AppNexus was on the path to a $2 billion public offering, but the market went soft for ad tech. Monday's acquisition is a win for AT&T, which hopes to use the AppNexus technology to improve the amount of money it can earn from digital advertising on its TV channels, which include Turner's CNN and TNT. The new firm will become part of AT&T advertising and analytics unit.
In other AT&T news, the WSJ reported Sunday that it had talked to CBS's controlling shareholder about a possible acquisition before turning its attention to Time Warner. The WSJ reports that CBS controlling shareholder Shari Redstone axed the idea, though her reps say she simply met the AT&T chief, Randall Stephenson, and no more was said. Either way, the story looks like it helps CBS build its legal case that Redstone made decisions that weren't in the interest of all shareholders.