New York – AOL, the Time-Warner owned American Internet services and media company, has lately announced the acquisition of a controlling stake in a German online advertising firm Adtech AG, in an attempt to deliver vast volume of ads to big Web sites in Europe.
Adtech, based in Frankfurt, provides digital marketing solutions to web publishers in 25 countries, and has also developed the Helios IQ platform, that lets publishers manage traffic and report on their online ad campaigns.
AOL is already heavily involved in the online advertising field and currently own Advertising.com, which provides advertisers with display, video and affiliate advertising networks. This network has a large user base in the USA, but has not been quite as successful in the European market.
The deal gives AOL access to this so-called “next generation” ad serving platform. It will now become a subsidiary of AOL’s advertising division, Advertising.com, and will continue to be headquartered in Frankfurt.
This acquisition is said to complement AOL’s existing advertising.com property, allowing advertisers access to the advanced Adtech campaign management and reporting tools, and increasing the number of sites outside the American sector to which the AOL network serves adverts.
This is AOL’s second acquisition in recent week. Lately, the company had bought Third Screen Media, whose technology delivers advertisements to mobile devices. Earlier, in 2006, it had acquired Lightningcast, an audio and video advertising technology firm.
The Adtech deal is similar in structure to some recent high-profile deals, such as Google’s buyout of Doubleclick and Yahoo’s acquisition of Right Media, in which a large online company buys a company to consolidate their expertise in the online advertising field.
Financial terms of the deal have not yet been disclosed but it is likely that Adtech will become a majority-controlled subsidiary of AOL’s Advertising.com division.
AOL’s previous $900 million offer to buy into the digital marketing business in Europe — TradeDoubler AB — was thwarted by large shareholders of the Swedish firm earlier this year.
With Third Screen Media under its fold, AOL will now be able to cater to the mobile advertising market, which in the U.S. is expected to reach $4.7 billion by 2011. Third Screen Media has technology that offers several modes for advertisers to reach basically digital audiences.
Besides AOL, Adtech’s leading customers include: Clear Channel Outdoor in Sweden, Frankfurter Allgemeine Zeitung’s FAZ.net, British publisher Emap, Reed Business Information and British Sky Broadcasting’s Sky.com.
Time Warner has staked AOL’s future on the growth in online ad sales, which increased 40 percent in the first quarter this year and are expected to rise on par or better than industry averages, the company has said.
The company’s share price also hinges on the success of a strategy to transform AOL from the dial-up internet provider of yesteryear into a modern online advertising juggernaut.