• Outstream Video Ad Innovator Teads is Acquired by Altice for $307 Million

    Teads, which pioneered the outstream video ad format that has been widely emulated, is being acquired by Altice, the multinational telecom provider.  The purchase price is up to 285 million Euros, or approximately $307 million, with 75% paid at closing and the remaining 25% based on Teads’ 2017 revenue performance. Teads’ Executive Chairman Pierre Chappaz and CEO Bertrand Quesada will continue leading Teads.

    For Altice, which previously acquired and combined 2 large U.S. cable TV providers Cablevision and Suddenlink over the past 2 years, creating the 4th-largest player in the industry, the Teads deal is a bid to increase its advertising footprint, which the company said will be 700 million Euros or nearly $650 million per year.

    Altice’s CEO Michel Combes said in a press release that it’s is aiming “to offer a truly unique value proposition to brands and agencies on the one hand and the media industry, programmers and distributors on the other. It is that value proposition - data-driven, measurable and multiscreen - which will enable us to significantly grow our advertising business.”

    I’ve been covering Teads for nearly 4 years, when their clever outstream ad unit, which enables text-based content to carry video ads, hit my radar. The outstream model was and continues to be so impactful because it allows publishers to tap higher video CPMs without having to create expensive video content. Teads’ outstream format only plays when the ad is in view.

    The outstream format has grown in popularity over the years, with many ad-tech providers offering variations of it. Teads says it now works with 500 publishers globally, enabling direct sales and programmatic sales as well as a marketplace. Teads said revenue grew 44% in 2016.

    The Altice-Teads deal echoes Verizon’s acquisition of AOL (and soon Yahoo), AT&T’s proposed acquisition of Time Warner and even Telstra’s acquisition of Ooyala. All are following essentially the same model of large telecom providers acquiring either/both content and ad technology which can be leveraged against subscribers’ behavior to enable more targeted and valuable advertising. Of course, the Verizon and AT&T deals also include major content assets, whereas the Telstra and now Altice deals are more tech-focused.

    Still, the underlying trend is that telecom providers are realizing that they want to do far more than carry the bits across their networks; they want to fully monetize them as well. With mobile video poised to soar for many reasons, I anticipate that the marriage of telecom with content/adtech will only accelerate too.

     
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