Unicast Acquires Enliven

In a development that further consolidates the rich media advertising space, Unicast, best known for its Superstitial pop-up ad formats, has acquired Enliven, a former division of Excite@Home and an early leader in the arena.

Financial terms of the transaction were not disclosed.

Waltham, Mass.-based Enliven has been rumored to be struggling and seeking a buyer since it was spun-off from Excite@Home in February 2001, and was once reported to have been in negotiations with DoubleClick. New York-based Unicast appears to have found Enliven attractive not for its banner advertising technology, but because of its serving and tracking capabilities.

“Unicast has acquired the company because its platform fits very precisely with the kind of efficiency and measurement abilities that Unicast has sought to bring to the Internet advertising marketplace,” said Richard Hopple, Unicast’s chairman and chief executive officer. “Additionally, the combination of Unicast’s and Enliven’s intellectual properties further support Unicast’s focus on providing and maintaining standardized and comprehensive formats and services that drive increased advertiser spending and the overall online economy.”

That technology will be integrated into Unicast’s Superstitial platform, and the banners — the company’s other product — may be phased out after a transition period. Unicast has committed to honoring existing ad contracts, all of which expire by the end of the year. Meanwhile, the company said it would “evaluate the Enliven format offerings and respond to marketplace demand” over the next few months, but reiterated its aim to push industry standardization — i.e. reduce the number of competing rich media formats.

“This acquisition will increase the level of service for our customers and give them even more reasons to raise their online spending and presence,” said Allie Savarino, Unicast’s senior vice president of global marketing and partner services. “A positive byproduct of this is its impact on ‘clutter clean-up,’ helping move the industry to the adoption of ad format standards. I think its very important to recognize how much more efficient this medium can get with standardization. ”

Scott Kliger, an Enliven founder and partner at Sage Hill Partners, who has served as the company’s CEO since April 2001, will go back to working solely at the venture firm, which was an investor in the rich media company after its spin-off. Around ten other Enliven employees will join Unicast to ensure a smooth transition. The remainder of the employees — estimated to number about 8 or 10 — will be laid off.

The deal also brings to a conclusion a patent dispute that led Unicast to serve Enliven with a “cease and desist order” earlier this year. After receiving the order, Enliven had agreed to halt sales of its pop-up interstitial ad format, which Unicast said was too similar to its patented Superstitial. With the purchase, the matter is laid to rest completely.

The acquisition is the final chapter in a saga that mirrors the story of the overall interactive advertising industry. The firm started up as Narrative Communications in 1995 as the Internet itself became commercialized. Narrative was snapped up and became the Enliven business unit of ISP @Home in December 1998 in an acquisition valued at $89 million. The hope was that Enliven’s rich media advertising would go hand in hand with @Home’s high-speed Internet access. That hope had completely faded by 2001, when a troubled parent — then Excite@Home — spun off the unit in an effort to concentrate on its core business. Over the years, Enliven counted among its clients General Motors, Budweiser, Procter & Gamble, and American Express.

The purchase marks the second big consolidation within the tight-knit rich media community. Last year, MindArrow Systems purchased the assets of Radical Communication, bringing together two players in the rich media email space. With this latest joining of two early pioneers in rich media, only Bluestreak, among the first generation of rich media companies, remains standing as an independent firm.