Norwegian mobile carrier Telenor on Monday snapped up cross-device company Tapad for $360 million. Tapad is one of the two largest cross-device vendors in the space; Drawbridge is the other.
It’s a move somewhat reminiscent of the AOL/Verizon deal, but with more global scale, said Tapad CEO and co-founder Are Traasdahl, who also is from Norway.
“The Verizon and AOL deal is a good one for both of them if they can execute on it, but they are two US companies with no real international presence,” Traasdahl told AdExchanger. “With this deal, Telenor can help us get into other markets where we aren’t currently, like Southeast Asia, where the cell phone is often the only screen people are using.”
Listed on the Oslo Stock Exchange and headquartered in Norway, Telenor has 200 million subscribers across Scandinavia, Eastern Europe and Asia.
And it’s got churn to reduce, average revenue per user to juice and dumb pipes to monetize.
Which is why the trend of telcos and advertising coming together is something the industry is going to see more of, Traasdahl said.
“Historically, telcos have bigger systems and have taken longer to make real-time decisions around traditional CRM,” he said. “But technology coming from the advertising world is more real-time, as we know, and completely data-driven.”
The opportunity is ripe, said Jennifer Lum, chief strategy officer and co-founder of Adelphic.
“We saw early initiatives from AT&T AdWorks and Verizon’s Precision Market Insights, but scale was challenging at times,” Lum said. “Investing in bringing ad tech and probabilistic data linking capabilities in-house should allow more telcos to bring more scalable and competitive ad solutions to market.”
Tapad will continue on as a standalone subsidiary, keeping its focus on its existing client base while dedicating 15% of its resources to the Telenor business with a plan to swell its existing ranks – Tapad’s headcount stands at around 165 – as swiftly as possible. All of Tapad’s current employees will be staying on board.
Through the deal, Telenor will get the royal treatment from Tapad. Telenor will be “a customer similar to our other customers, but a very special one,” Traasdahl said.
What Tapad can help Telenor do with its deterministic subscriber data is an interesting proposition, but it’s still in the works from a practical point of view. Still, 200 million users is a healthy truth set to feed a cross-device identity graph.
“We have a data set they don’t typically see – anonymized data that sits between mobile devices, tablets and computers, as well as purchasing behavior and insight into what consumers are doing – and from the telco side, they of course have access to data that few others have,” Traasdahl said. “But there is no big announcement yet around what we plan to do there yet, although there’s a lot of potential for product research and innovation.”
The deal also lets Tapad grow in markets beyond the US.
“The US is ahead of other markets in our industry, as we know, but most US companies forget that 96% of the world population lives somewhere else,” Traasdahl said. “We see this as an opportunity to take the technology and products we built in the US and scale them internationally. It’s also true that a lot of our customers are global, like Oracle, and they’ve been asking us about having our services available globally and how fast we can do it.”
That said, emerging markets can be tricky from a cross-device perspective. If a phone is a user’s primary device, doesn’t that make the cross-device matching question moot? Not necessarily, Traasdahl said. Whereas PCs have been the gateway to mobile devices in more mature markets like the US, for example, elsewhere the opposite is often true.
“The beginning of the journey for many consumers is the phone, and then television, tablets and computers are secondary platforms,” he said. “But, in any case, we need to have a unified view of the data across all of the different touchpoints a consumer has, whatever they may be. Cross-device was the reason we built our technology, but that also gives us an advantage when it comes to managing the data and what to do with it as well.”
Based in New York City, Tapad also has offices in Atlanta, Boston, Chicago, Dallas, Detroit, Los Angeles, Miami, Minneapolis, San Francisco, Frankfurt, London and Toronto. Since it was founded in 2010, Tapad has raised $33.8 million, including an $18.5 million Series B round led by Blue Cloud Ventures, Avalon Ventures, FirstMark Capital, Silicon Valley Bank and several others.
In other recent cross-device news, intent-targeting platform Qualia merged with cross-device vendor BlueCava in January in a bid to combine cross-device data with purchase signals. The terms of that deal were not disclosed.