The world of digital advertising is at its peak and will undoubtedly continue to be a key component in companies marketing strategies for years and decades to come. In a massive strategic move, the content recommendation company Taboola has announced it is acquiring Outbrain for $250 million.
“We are excited to partner with Taboola. Both Outbrain and Taboola have a shared mission and vision of supporting quality journalism globally and delivering meaningful value to the open web marketplace,” said Yaron Galai, Co-Founder and Co-CEO of Outbrain.
So Why Has This Happened?
Google and Facebook have been dominant for years now. Both companies having a wide and diverse portfolio of companies and advertising partnerships. According to e-Marketer, Google and Facebook have around 70% of the entire U.S. digital advertising spend used through their platforms. It is going to take something pretty significant to make a dent in their high castles.
What Does This Mean?
In a bid to take on the giants, Taboola and Outbrain will alleviate the pains of fighting for media partnerships between each other, allowing them to have a good crack at taking on the big guns (Google and Facebook). Whilst enabling advertisers and publishers to reach larger and more diverse audiences.
What Is The Likely Outcome?
There have been mixed reviews to the press release so far and a lot of scepticism from publishers around quality control and pricing. Contrary to publishers beliefs, the new Taboola and Outbrain company claims it will be able to double or even triple companies current revenues from the independent platforms and that this should encourage companies to allocate larger budgets away from Google and Facebook.
It is also extremely likely that Taboola will look towards an IPO. “[An IPO] is obviously one of the routes for a company of our size,” Galai said. “We are absolutely looking to keep this company independent and sustainable.”
