Cogblog

I have been gone from AOL for almost a year now so I know less than nothing about what is going on in the world, but I wanted to throw out a random opinion or two on these rumors.  I have already given my opinion on the future of Ad Networks, so, no surprise, my opinion ties in closely with what I see going on out in the market.  Here are my theses:

1. Ad Networks will acquire most of their inventory by bidding into exchanges
2. Algorithms and access to exchanges will rule the day

Given the lack of announcements by AOL about the status of RTB bidding activity and anecdotal evidence regarding the state of the engineering team and the current focus of the engineering team, one could reasonably postulate that AOL has not been able to invest like they would have liked in scaling their bid engines to look at billions of transactions per day.

This implies that acquiring AppNexus, which has the bidding engine scale and is one of the premier intermediaries between exchanges and advertisers, might be a great tech fit.

AppNexus is a fairly unique company that is laser focused on building better technology than everyone else.  I am a big believer that whoever doesn’t acquire them will kick themselves for missing that opportunity.

So are they interested?  Fo’ sho.

Could it happen?  Seems unlikely.  For a company that has raised $15 million and is in the fairly unique position that they are in, they probably won’t want to sell for less than $100 million and it will be difficult, given the debt convenants AOL has, to do a larger deal.

Of course, this blog post could probably have been compressed to a tweet for all I know: AOL probably wants to buy AppNexus, as do many, but it seems unlikely.

This entry was posted on Monday, August 30th, 2010 at 11:04 pm and is filed under Online Advertising. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.