Yahoo Acquires Right Media

Fun days here at Right Media… I have been incredibly impressed with Yahoo!s strategic vision and commitment to the exchange model through the process. I think this will be a great marriage. More importantly, it makes the competition with GoogleClick that much more exciting!

Official Press Release: Yahoo! Announces Agreement to Acquire Right Media, Largest Emerging Online Advertising Exchange

New York Times: Yahoo to Buy Ad Company in Bid to Compete With Google

Some excerpts from the above New York Times article, by MIGUEL HELFT:

– “The acquisition, to us, is a key step toward executing our long-term vision to build the leading advertising and publisher ecosystem both on and off the Yahoo network,” Terry S. Semel, Yahoo’s chief executive, said in an interview. The deal is to be announced today and is expected to close in three months.

– Right Media, a four-year-old company, runs an exchange in which advertisers and publishers buy and sell online ad placements in real time through an auction system. DoubleClick, which specializes in serving ads on Web sites, announced recently that it would develop a similar type of exchange. Online publishers are increasingly turning to exchanges like these to sell ad space on their sites.

– “What we look forward to do as an owner is put more inventory into that pot to help create a more vibrant exchange and create better pricing for everyone,” Mr. Semel said.

– Yahoo said that after the acquisition it would increase its participation in the exchange as both a buyer and seller of ads. The company said it planned eventually to sell all the nonpremium ad space on Yahoo through the exchange, a move executives said would enhance revenue.

– Google and Yahoo each dominate one segment of the online advertising market. Google is best at selling text ads that appear alongside search results and on other Web sites. Yahoo, which has lagged Google in search, is a leader in selling graphical ads, mostly on its own sites.

– By buying Right Media, analysts have said, Yahoo would accelerate its own efforts to sell and broker ads on other sites. Those efforts began taking shape recently, after Yahoo reached agreements to sell ads on eBay and on some 264 newspaper Web sites.

(Note: For the math impaired, $680 million for the remaining 80% that Yahoo! didn’t yet own is equal to an $850 million in total valuation…)

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