AT&T has sold its ad tech organization Xandr to Microsoft.
Regards to the deal were not disclosed.
The acquisition marks the end of a unsuccessful and uncomfortable run for the one-time leader of the programmatic market, AppNexus, which was rebranded Xandr but never discovered a home within the AT&T company.
Previous AT&T CEO Randall Stephenson envisioned advertising as a third leg of what he termed a “modern-day media business,” with the other 2 being mobile and internet service and media. AT&T obtained the latter in an $85 million deal for Time Warner in 2016.
AppNexus turned out to be an awkward fit. It was overloaded by AT&Ts legacy television advertisement service– the AT&T AdWorks Lab– and by Time Warners advertisement sales. Neither had AppNexuss programmatic chops, but both were still larger and more successful companies than AppNexus.
AT&T employed Brian Lesser to lead the advertising group. But his prepare for a TV advertising “neighborhood garden,” where AT&T mobile information might ratchet up ad rates for other broadcasters, never materialized.
As with Verizon, which likewise got and then shed ad tech companies, AT&Ts method of mobile data-fused campaigns never cleared the best bars internally. Both business chose in the end that the potential personal privacy and PR issues were unworthy maintaining the advertisement tech.
Microsoft is a rational endpoint for the previous AppNexus company. It was an early financier in AppNexus and has actually been a flagship customer considering that.
And no matter the state of AppNexus tech, Microsoft will make good use of its engineering talent.
” With Xandrs talent and technology, Microsoft can accelerate the delivery of its digital advertising and retail media services,” stated Mikhail Parakhin, Microsofts president of web experiences, in a release.
Turn back the clock and AppNexus almost lost the Microsoft business in 2015 when Microsoft pitted AppNexus and AOL in a bakeoff for various parts of its advertisement sales. AOL, then owned by Verizon, won the lions share of Microsofts display advertisement organization and made deals to 1,200 Microsoft workers.
Then-CEO Brian OKelley personally intervened, instantly flying to Seattle to make AppNexuss case to maintain the Microsoft organization, and reversing what may have been a full-scale loss of the account, according to multiple sources.Microsoft also has great deals of ad tech and media parts where AppNexus competence might be available in convenient. Theres the Bing online search engine, Edge browser and the Windows Apps shop, which is currently a part of the AppNexus account, according to sources.
On top of that, Microsoft Xbox is a fascinating marketing and identity property, as is LinkedIn, which is also owned by Microsoft. Microsoft got cross-device start-up Drawbridge cross-device for about $300 million in 2019 to boost LinkedIns advertisement tech chops, and purchased online retail marketing start-up PromoteIQ in 2019 to help Microsoft diversify beyond its B2B roots.
Even so, Microsoft is rarely thought of as a huge gamer in data-driven or programmatic television advertising, which is the AppNexus tradition.
Parakhin stated that the Xandr offer will assist Microsoft with its effort to win in the brand-new digital ad marketplace in a method “that appreciates customer personal privacy choices, understands publishers relationships with customers and helps advertisers satisfy their goals.”