Just a week after its $85bn Time Warner takeover was rubber-stamped, US telco AT&T is reportedly in talks to purchase adtech outfit AppNexus, in a move that would better enable it to take on the likes of Facebook and Google.
Such a move would equip the telecoms giant with a firm hand in the online advertising space and represent a significant milestone in a period of aggressive expansion for AT&T.
Following its purchase of Time Warner, AT&T has ownership of Turner, HBO and the Warner Bros. film studio, all of which would provide useful content for a planned ad-supported streaming video service. The purchase of AppNexus, which had earlier been valued at $2bn, would hand AT&T the ability to fully monetize such content at scale across the globe.
Not content with straddling telecoms and media, AT&T has also committed itself to building "a significant advertising platform" and has recruited Brian Lesser, former chief executive of GroupM North America, and one-time board member of AppNexus, to oversee such efforts.
Reports in Cheddar suggest that this latest deal is "close to being finalized" and while no price was given for the takeover it is believed that AppNexus would not leave any change from $2bn.
In the immediate aftermath of AT&T's Time Warner takeover being given the seal of approval, multiple market observers tipped a flood of M&A activity in the sector, with adtech outfits tipped as a likely hot commodity.
Terence Kawaja, chief executive of investment bank Luma Partners, said: “Now that AT&T has spent $150bn on traditional TV content and distribution [Time Warner & DirecTV], they now need digital monetization and data capabilities to take advantage.”
Ciaran O’Kane, chief executive of WireCorp, told The Drum that Lesser and "the rest of these super-sized telco amalgams" will start buying soon. "Lesser didn't spend the vast majority of his career understanding adtech to not see the blind spots in AT&T's ability to monetize its owned-and-operated media,” he added.
AppNexus was earlier rumored to be considering an Initial Public Offering in 2017 but subsequently shied away from the idea.