AOL Acquires Mobile Ad Firm Third Screen Media

  |  May 15, 2007   |  Comments

AOL purchase is a sign of traction in mobile ad market, analysts say.

AOL's Advertising.com division acquired Third Screen Media to add its mobile advertising network and ad serving capabilities to AOL's offerings.

Third Screen Media will operate as a wholly-owned subsidiary of AOL's Advertising.com division, AOL, which is part of Time Warner, said in a statement today. Terms of the deal weren't disclosed.

One week prior to the acquisition announcement Third Screen Media released statistics from its ad network. It serves more than 225 million monthly advertising impressions across more than 185 mobile content sites including AccuWeather, Boston.com, Fox News, the Gannett network of newspapers, Maxim, Wapipedia, and WWE.

"People are starting to realize, if done right, you really can do advertising on the mobile Internet," said Mike Wolf, research director for digital home at ABI Research.

Telephia's VP of mobile content Kanishka Agarwal calls the acquisition good news for the mobile industry. "When advertisers look at their ad spend, they want to look across all the screens," Agarwal told ClickZ News. "The more an advertiser can get a one-stop shop where they can think about an ad spend across the three screens, that makes their lives easier."

Third Screen Media will remain headquartered in Boston. AOL acquired Advertising.com in June of 2004.

AOL sees this as an opportunity to let "us offer advertisers a more complete set of solutions, from display advertising to search and now a superior set of mobile solutions," AOL CEO Randy Falco said in a statement.

Representatives from AOL and Third Screen Media declined to comment on the acquisition.

Total mobile advertising and marketing spending is expected to reach $3 billion this year, according to analyst firm ABI Research.

The purchase of Third Screen Media follows Microsoft's acquisition of ScreenTonic. While there has been speculation of consolidation within the mobile industry, both Third Screen Media and Screen Tonic were acquired by large service providers, rather than competitive mobile companies. As long ago as last year there was speculation that Microsoft was in talks to acquire Third Screen Media.

Wolf sees the two examples as service companies extending their platform to cover all access points. "For content, people want to get on as many platforms as possible," he said. "People see mobile as another platform, largely the same decision as AOL's Advertising.com that will oversee Third Screen Media."

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