It seems like one of the best internet providers in the US, AT&T® is on a buying spree. Recently, this telecom giant completed their merger with Time Warner® at $85 billion, and following that came the announcement that AT&T® is bidding to buy the digital ad exchange AppNexus for $1.6 billion.
Reports say that AT&T’s aim is to have deeper inroads with digital advertising by making use of the advertising technology of AppNexus. AT&T® has been having interest in digital advertising since this conglomerate became the largest pay-TV service provider in the US, following the acquisition of DirecTV® in 2015. After its merger with Time Warner®, AT&T® is said to be running a dedicated analytics and advertising segment that indicates that the company seems to be having more interest in digital advertising.
AT&T® is counting on digital advertising as a means to reduce the prices for the consumers, transferring a part of the content creation cost from the consumers to the advertisers. The telecom giant has a particular interest in databased advertising like addressable TV ads, mobile ads, and digital ads. AppNexus would possibly give the corporation a stronger position in the field of digital ad marketing.
Unlike some tech companies that work only for app developers and publishers for managing inventory, or for the marketers who purchase ads, the software platform AppNexus is known to carry out both these tasks. The digital ad marketing is a highly competitive zone, with Silicon Valley giants Facebook and Google dominating the space. As per the report by eMarketer in 2018, Facebook and Google are projected for holding 60 percent of the digital advertisement market in the United States of America. The wireless rival Verizon® by AT&T® has a distant third position in the digital ad market with the help of its Oath subsidiary that operates the erstwhile Yahoo! and AOL.
Even though AT&T® may play a small role in the digital ad market, it may still have many advantages. Firstly, the conglomerate can make use of its wireless data to much better target ads. In the digital ad market, the mobile data is the most difficult to obtain, as advertisers use traditional browser cookies for targeting consumers on the desktop don’t work universally on mobile devices.
AT&T® could be able to outwit this with wireless data used by 130 million consumers. In addition, the reach of AT&T® across channels including TV and mobile could build up a buying platform, which includes many ad formats including digital video and TV ads.