Yahoo! Acquires BlueLithium

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The word is out. BlueLithium which is the fifth largest online advertising network has officially been acquired by Yahoo for a hefty $300 million.

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This acquisition is aimed at assisting Yahoo in attracting direct response marketers. Senior vice president of Yahoo publisher network, Todd Teresi was quoted in Advertising Age to state that the acquisition is part of “our strategy of leading a transformation in how advertisers connect with publishers.”

Acquiring BlueLithium is not the move Yahoo has taken to reinvent itself. The purchase of Right Media earlier this year signaled the first step taken to reorganize the company.

While Yahoo usually appeals to brand marketers that are traditionally focused on engagement and brand lift, conversion is the concentration of the firm right now. This comes at a time when one of the company’s major competitors, Google is focusing on brand advertisers, in an exchange of roles by the firms.

Blue Lithium launched in 2004 and will have access to Yahoo Publisher Network inventory and inventories owned and operated by Yahoo as well as add its inventory to the Right Media Exchange.

Analyst’s reactions have been fairly positive. Many believe that the deal will bring positive growth to the company. Thomas Wiesel analyst Christa Quarles was quoted in Zdnet to say “We believe BlueLithium brings three things to Yahoo!: (1) Scale in its ad network business; (2) strong behavioral targeting technology; and (3) a string international presence. BlueLithium is expected to become a part of the Right Media exchange upon completion of the acquisition (though Yahoo! has already been working with BlueLithium on its own remnant inventory)…We believe BlueLithium may not be the last ad network that Yahoo! Consolidates in its quest for scale. In addition, while BlueLithium relies heavily on cookie data, the combination of search data and cookies could hasten the improvements in monetization on Yahoo! Remnant inventory.”

Imran Khan, analyst for J.P. Morgan stated, “We believe BlueLithium will further improve Yahoo’s monetization of display advertising. We believe advertisers will pay higher CPMs for responsive targeted ads. We think that, in addition to Right Media, Blue Lithium’s adPath technology will help further monetize remnant inventory.”

Yahoo has also seen a shakeup in management. With the exit of Terry Semel and the re-entrance of Yahoo founder Jerry Yang, numerous executives have taken their cue to leave the company while Yang plans and executes an overhaul to the search giant. Susan L. Decker being appointed president was one of Yang’s first changes to bring the right people into the right positions in the company to propel it forward into a new renaissance in the coming years.

Teresi continued to say of the partnership “Our ability to drive accelerated revenue growth will rise from our ability to give salespeople…extensions of audiences and aggregated audiences. That’s the tool for No. 1 market share.”

2 COMMENTS

  1. This is an interesting decision considering that Right Media has the REMIX Ad Network, which competes directly with Blue Lithium.

    Also, the decision not to acquire one of the networks using the Right Media system that have comparible revenue and assets is a strong statement.

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