News Corp. Buys Large Stake In Utarget
New York – Rupert Murdoch’s News Corp. for a while now, owning Fox International Channels global online ad network, “.Fox Networks,” on Tuesday extended the chain by acquiring a majority of stake in “Utarget,” an European ad network that specializes in pop-under online video ads as part of a move to expand in Europe and Asia.
The News Corp.’s Fox Interactive Media Internet unit, which manages the popular social network MySpace, .Fox has calmly ventured on an expansion outside the United States since its founding last year from the combination of two Latin American online ad networks — Click Diario and Directa.
Advertising is the potentially emerging name of the game here, and more specifically, advertising of the outside-America sort. Based in UK, Utarget serves European markets; though .Fox Networks operates in Europe, Asia, and Latin America, collectively, they could get to something in the neighborhood of 70 million users per month worldwide.
The little-known division of Fox International Channels is being considered as a possible key player for global growth for Fox Interactive Media’s MySpace group as it seeks to generate more ad dollars from its estimated 110 million monthly unique visitors around the globe.
While disclosing the deal, .Fox Networks — a unit of Fox International Channels — said the acquisition will provide added prospect for video advertising to News Corp.-owned sites, third-party publishers, and advertisers.
It is not known that how much .Fox Networks paid to bring the combination about, however. Hernan Lopez, president of .Fox Networks and COO of Fox International Channels, stopped short of revealing the exact terms of the deal other than to say “it is a low-eight figure number.”
Lopez added that Utarget is a top player in the use of pop-under video for online advertising. “Pop-unders are the most valuable online ad format, bar none,” he said. “Utarget pioneered the technology of putting a video player on a sub-site. The advantage that brings to a Web site publisher is that it allows them to capitalize on the growth of online video ads without having to invest in online video content.”
Utarget manages an online video ad network consists of more than 630 Web sites and generates the majority of its revenue in Britain. It also has an office in Germany, the company said.
“Its online video ad product allows advertisers to run video ads in a different window displayed below the page being viewed.”
Announcing the acquisition, Fox will form a new online ad sales division, “Utarget.Fox,” which will aim to sell inventory to both TV and online buyers.
“.Fox trades in unsold ad stock across a group of sites operated by Fox and third-party sites to advertisers outside the United States.”
Lopez stated that the plan behind the purchase is to create an aggregated buy across hundreds of publishers, both News Corp-owned and others that includes — MySpace, Askmen.com and Photobucket are some of the News Corp. sites that Fox will look to take control of.
“Combining our TV sales mentality with ad technology gives us the best of both worlds,” added Lopez. “Online video is a great promise, but not enough of it is advertiser-friendly.”
“Utarget creates a TV sub-site that means advertisers can play full-length ads that are 100% safe because the page always features only the brand.”
Phil Cooper, Utarget’s founder and CEO, will stay in charge of the newly named company called Utarget.Fox.
Lopez said Fox International Channels (FIC), occupied with international television ad sales for 15 years, is a leading player in the field. “On the other hand, online video is a big opportunity that so far has not fully taken off,” he said. “Inventory is limited and online video is usually placed by, or overseen by, ad agencies with which Fox International Channels has great relationships.”
The Utarget purchase comes after U.S.-based Fox Interactive Media (FIM) shuffled its staff last week in hopes of a possible revenue target shortfall. The reshuffling, long in the works, will also see the launch of FIM’s long-awaited U.S. online advertising network, called the FIM Audience Network.
Fox Network employs about 150 staff in its sales division in 18 countries and claims to be one of the largest ad networks in the world. Also Utarget has about 40 people, said Lopez. “Apart from Fox’s television sales teams around the world,” he added. “Overall, we will have a collective sales team of well over 300 in 33 cities around the world.”
Utarget owns possessions including UrbanPlanet, FinanceDaily, TravelConnect and JustCompetition. Utarget announced in December 2007 plans to open offices throughout Europe.
Lopez concluded that the acquisition offers more opportunities for Fox to collaborate with BSkyB, which sells ads across Fox channels FX and National Geographic in the UK.