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Enliven Denies Rumors of Imminent Sale to DoubleClick

Enliven Inc., one of the first companies to adopt Flash-based rich media for online ads, is denying rumors that a sale of the company to DoubleClick Inc. is imminent.

DoubleClick would neither confirm nor deny it is in talks to acquire Enliven, though if its recent acquisitions are any indication, it has no interest in the rich media company.

DoubleClick acquired e-mail marketer MessageMedia in January, bought the technology assets of marketer L90 Inc. in October and purchased Toronto-based e-mail marketer FloNetwork Inc. in February 2001.

The company apparently is shoring up its e-mail technology assets at the expense of its ad serving media assets. Morgan Stanley analyst Michael Russell recently said he no longer would treat DoubleClick as a media company, but as a technology firm.

Though he would not rule out ever selling the company — to DoubleClick or anyone else — Enliven CEO Scott Kliger said he had no immediate plans to sell it. The issue was prompted by reports on the Cnet.com Web site citing “sources close to the company” as saying Enliven is in its third round of talks with several companies, including DoubleClick.

“It's not unusual in this industry for one company to hold strategic talks with other companies in the industry,” Kliger said. “Conversations take place all the time.”

DoubleClick spokeswoman Jennifer Blum said the company does not comment on rumors.

Still, the company said earlier this month that its rich media business has been growing. DoubleClick in October introduced its rich media trafficking module, which consists of rich media templates and rule sets, to streamline the trafficking of rich media creative. In the two months after the module's introduction, the relative volume of rich media ads served by DoubleClick rose 12.5 percent, the company said. In December that grew by an additional 13.5 percent.

According to Bill McCloskey, CEO of Emerging Interest LLC, a New York-based rich media trade group, any interest in Enliven by DoubleClick would center on Enliven's tracking and reporting technology for rich media ads.

“They [DoubleClick] may not be interested in generic ad serving, but they're definitely interested in rich media ad serving,” he said. “They're making a big push to put templates and other things into DART and making it easier to deploy.”

Enliven, Waltham, MA, was spun off from bankrupt [email protected] in February 2001. The company reportedly has been looking aggressively for a buyer since late last year. Analysts noted that DoubleClick, Avenue A and Macromedia, the developer of Flash technology, are the most likely candidates to acquire Enliven.

Kliger, who founded Enliven and developed the technology behind its rich media interstitial ads, also founded venture capital firm Sage Hill Partners, which invests in Enliven and its rival rich media ad supplier Unicast.

“We talk to everyone in the industry on an ongoing basis, and further consolidation would be both healthy for the industry and not surprising,” Kliger said.

Analysts said that it's increasingly harder for companies like Enliven to stand out from the crowd. As rich media advertising gains acceptance by publishers, the products available from companies like Enliven; Unicast, with its Superstitial; Eyeblaster and United Virtualities, with its Shoshkeles, all start to look like a commodity.

Since Enliven was one of the first in the market — rich media interstitial ads have been around since 1996 — it has found itself playing catch-up to the likes of Unicast and others.

Also, its association with [email protected] more often than not was a liability. Kliger said the company many times had difficulty persuading potential clients to sign with Enliven instead of one of its rivals because the client would be limited to advertising on [email protected]'s network of sites and was precluded from advertising on other major portals such as Yahoo.

“Being sold by Excite was the best thing that could have ever happened to Enliven,” Kliger said. “It was always a hurdle we had to get over, being associated with Excite. It's much easier now that Enliven runs on an independent platform.”

[email protected] bought Enliven in 1999, when it was known as Narrative Communications. [email protected] planned to sell Narrative in early 2001 along with its MatchLogic subsidiary. However, Kliger took Narrative public instead, and changed the company's name to Enliven.

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