Yahoo today made a big play for video advertising business, announcing it had entered into an agreement to acquire BrightRoll, a top programmatic video ad platform. The price will come to approximately $640 million in cash, Yahoo reported.
According to comScore, BrightRoll has served more video ads in the U.S. than any other platform this year. BrightRoll itself claims to serve the great majority of the leading 100 advertisers, all of the top 15 ad agencies, and 10 of the leading demand-side platforms.
A senior executive at one of those demand-side platforms thought the deal made sense for both parties. “For Yahoo, video presents a great opportunity to combine their historical strength in display and their newfound focus on mobile,” said Andrew Bloom, SVP of strategic business development at Sizmek. “For BrightRoll, Yahoo offers the credibility of a global demand channel and access to first-party data across devices that should offer TV-like scale with digital video.”
For its part, Yahoo claims that adding BrightRoll will make its video advertising platform the largest in the U.S. and will accelerate its proliferation of digital content via multiple channels.
“Video, along with mobile, social, and native, is driving a surge in digital advertising. Here at Yahoo, video is one of the largest growth opportunities, and BrightRoll is a terrific, strategic, and financially compelling fit for our video advertising business,” said Yahoo CEO Marissa Mayer (above) in a statement announcing the acquisition. “The combination builds positive momentum for Yahoo’s broader display advertising business in 2015.”
The competition in video, however, has become formidable. AOL and Google have more entrenched video operations, and Facebook raised its video profile with the acquisition of LiveRail in August. “On the demand side it’s going to be fascinating to see if Yahoo preserves BrightRoll DSP’s open access to all inventory, or if Yahoo will leverage its inventory and data to create a preference for Yahoo inventory bought through the BrightRoll ad stack,” said Bloom.