Christmas came early for digital video ad platform true[X].
The ad platform, which serves both advertisers and publishers, revealed Wednesday that News Corp. spinoff 21st Century Fox intends to acquire it. Although the terms of the deal were not disclosed, The Wall Street Journal pegged that figure at about $200 million. (Read the release).
This acquisition indicates 21st Century Fox has realized the traditional ad model (17 minutes of ads per hour) won't translate to streaming or video-on-demand environments, where content isn't consumed in real time, said Jim Nail, principal analyst at Forrester Research.
The deal comes on the heels of other recent video ad acquisitions, such as German media conglomerate RTL Group's summer purchase of video sell-side platform SpotXchange and Yahoo's recent purchase of BrightRoll.
But Nail said the motivations behind the true[X] deal aren't the same.
"This is very different than some of the consolidation we've seen between ad exchanges and programmatic and technologies and data management platforms," he said.
"This is about changing a model built for the passive TV world and realizing it just won't translate to an active consumer-controlled world," he added. "Clearly, Fox thinks something needs to be done to create a new model where people are actively selecting their [content and ads] as opposed to just channel-surfing."
There's also significant difference between the standard video marketplace and true[X]'s value proposition. For instance, while some claim that open exchanges are rife with fraud and non-viewable impressions, true[X] claims its full-screen units are fully opt-in and by that virtue, are 100% viewable and human (It partners with Moat and White Ops, respectively, to measure these factors).
True[X], once doing business as SocialVibe, employs 70 people in six US offices and has a video exchange called true[EXCHANGE] that focuses on engagement metrics based on "attention" and unit interactions, as opposed to impressions or clicks.
True[X] is also testing new ad models with customers, offering streaming subscription-based services ways to tier viewer experiences. For instance, viewers may opt out of a certain number of video ad minutes in a given episode by interacting with a 30-second to one-minute "engagement" ad.
"At Fox, we are constantly working to create ad experiences that empower marketers to reach consumers in new or more effective ways," said Randy Freer, president and COO of Fox Networks Group, in a statement. "We are excited about the opportunities true[X] brings to enhance ad engagement for consumers on our networks' digital platforms."