Back in March, AT&T announced it intended to buy T-Mobile U.S.A. for $39 billion. That move would have given AT&T a massive boost in bandwidth, which the company asserted would allow it to provide better service to its customers. It also would’ve made AT&T the largest wireless provider in the U.S., and it would have left AT&T and Verizon in control of 70 percent of the domestic wireless market. The proposed merger has been under fire since then — mostly from competitor Sprint Nextel (one notch behind Verizon in U.S. market share) and from the U.S. government. It came up before committees in both houses of Congress, and the Department of Justice filed its antitrust suit on Aug. 31, citing the chances of, as deputy attorney general James Cole put it, ”tens of millions of consumers across the U.S. facing higher prices, fewer choices and lower quality products for wireless services.” On Nov. 22, the FCC opposed the merger by requesting an administrative hearing — a move that surprised many who were aware of AT&T’s formidable lobbying capabilities (the Washington Post has a detailed report today on what went wrong for AT&T over the course of the proposed acquisition and resultant hearings). In the face of FCC resistance, AT&T withdrew its application to acquire T-Mobile on Nov. 24.

In spite of everything, AT&T still wants to go through with the acquisition, which means the postponement of the antitrust case leaves the company stymied. AT&T says it pulled its FCC application so it could focus on the Department of Justice case; U.S. District Court Judge Ellen S. Huvelle pointed out AT&T could change the terms of its deal with T-Mobile in the midst of emerging from the antitrust case and re-applying with the FCC. ”You could change the deal in a month and everybody’s time will be wasted,” the judge said. That explains why the Justice Department will postpone court proceedings until AT&T and T-Mobile go before the FCC again.

German telecommunications company Deutsche Telekom AG still wants the deal, because it reportedly has enough spectrum to last until the end of 2015.

In the rich media world, consolidation has usually proven to be the embarrassing uncle at the family reunion, or, in Howie Mandel parlance, a “No Deal!” proposition. Consider the following failed marriages:

• MatchLogic and Enliven (1999)
Hailed as a perfect match between the digital ad serving, measuring and targeting (Enliven) and the pioneer of digital marketing’s intelligent targeting (MatchLogic), this deal went south quickly because it never lived up to expectations and never delivered anything meaningful to a marketplace that wasn’t ready for it. The online market was focused on inventory management and media buying and we watched as ultimately Enliven was acquired by Unicast two years later.

• DoubleClick and Macromedia (2003)
More of an alliance, both companies lauded the fact that they would “dramatically reduce complexity in the rich media advertising process with a single, streamlined workflow” while “simplifying the process of trafficking and reporting on rich media advertisements for advertisers, agencies and publishers.” These two best-of-breed companies seemed as if they would produce a thoroughbred. Instead, they produced a one-trick pony that forced the template model and turned creative possibilities into [the promise of] operational efficiencies; essentially providing a canvass, but no paint.

• aQuantive and Ads4Ever (2004)
aQuantive (ad serving) acquired Ads4Ever (rich media software) in the hopes of creating a rich media juggernaut. Another acquisition that has yet to bear any fruit, aQuantive created much confusion in the marketplace. aQuantive is best known as a great creative and media buying agency with a very powerful ad serving engine. Few, if any customers have embraced this platform to date, proof that ad serving and technology companies find it difficult to grow into a rich media platform, even when your roots are steeped in the interactive agency world.

• ViewPoint and Unicast (2004)
The press release extolled the potency of two, innovative rich media companies merging. Unicast with its sales force and rich media formats and Viewpoint for its access to public markets and strong, existing desktop and 3D rendering tools. Once more, a failure. Not due to name recognition or technological shortcomings — in fact both companies have been pioneers in the rich media space — but because they failed to execute well and did not believe in their offerings.

• DoubleClick and KlipMart (2006)
More recently, the rich media industry saw consolidation with the purchase of video rich media company Klipmart by DoubleClick. Right now there are more reasons for this partnership to fail than to succeed as DoubleClick has not executed a merger successfully to date. Second, DoubleClick is in the business of serving ads, not producing creative and interactive rich media ads. Further, because DoubleClick’s business model is based upon serving ads, their focus is on volume and transactions, not creativity. Rich media is all about creativity, not just serving ads.

• Yahoo! and AdInterax (2006)
AdInterax (formerly known as Fysix) originally had its sights set on syndicated games and contests when it was found in 1998. In 2001, it changed its name and its focus to rich media software development. Basically, AdInterax builds rich media templates. Yahoo’s acquisition of AdInterax is the first attempt by a media company (portal) to own and integrate a rich media solution into its core media offering.

This is a tool for Yahoo! only inventory and will appeal only to a small set of advertisers. What Yahoo! may not recognize is that the majority of advertisers include other sites in their media plan and will want to build one rich media ad unit to run across all sites. Based on our experience, very few advertisers demonstrate the desire to build multiple units for every site on a rich media plan, thus the reason for integrated third party rich media.

“ClickTracks is one of the fastest growing web analytics companies serving the SMB market,” said David Burt, CEO of J.L. Halsey. “We look forward to seeing additional innovative ClickTracks products on the market — more quickly and well integrated with other vital online marketing tools.”

John Marshall, CEO of ClickTracks, felt that the merger will allow ClickTracks to “serve a larger customer base with expanded support, new integrations and quicker time to market with our upcoming features and products.”

ClickTracks will operate as an indirect, wholly-owned subsidiary of J.L. Halsey. John Marshall will continue as CEO and no restructuring actions are planned.

The merger brings together MediaWhiz, widely known for its affiliate marketing, co-registration, and lead generation services, and GRS, whose expertise lies in list management and email marketing, while also bringing additional capabilities in affiliate and search engine marketing. Both business units will continue to be led by their respective founders, Jason Cohen of MediaWhiz and Yannick Tessier of GRS.

GRS will continue to operate under its established brand and will be led by Tessier, who will also serve as the holding company’s co-president with MediaWhiz founder, Jason Cohen. “GRS and MediaWhiz have worked together extensively for several years by providing each other list management and lead acquisition services, respectively. Leveraging our organizations’ individual strengths and unique value propositions, we will be able to continue to enhance our combined position as one of the industry’s leading companies,” said Yannick Tessier in a statement.

Mediawhiz’s Cohen adds, “Our merger creates one of the broadest platforms of online performance marketing solutions available to advertisers today. Together, the capabilities of our two firms will allow us to generate an ever increasing number of qualified customers for our advertisers by capitalizing on our ability to reach consumers through a diversity of online marketing channels.”

Global Capital Markets served as the exclusive financial advisor to GRS on the transaction, but as of press time, no transaction terms have been disclosed.

Much of the added value can be attributed to major diversified media companies including Gannett, New York Times, Dow Jones and News Corp rapidly acquiring fast growing online content and delivery channels to offset pressure on their traditional media product. According to JEGI Managing Director Tolman Geffs, the forecast for 2006 looks fairly similar, if not more promising. “We expect a steady to upward M&A market in 2006, driven by continued consolidation in traditional media, rapid growth in online advertising, and investments in interactive growth by the major diversified media players.While the market grew very nicely in ’05, buyers remained largely disciplined and careful, and we expect that approach to help extend this market cycle in a healthy way.”