The advertising company MoPub has a new owner. In the near future, instead of Twitter, it will belong to the AppLovin technology platform. The latter will give more than a billion dollars for the purchase.
Buying MoPub
The deal was first announced on Twitter. According to the social network, it agreed to sell MoPub for $1.05 billion in cash. The exact deadline for closing the deal is not called, but according to the plan, the takeover should be completed in the “coming months” after it is approved by the regulator.
According to Twitter CFO Ned Segal, the sale of MoPub will allow his company to focus on its own products.
“Thanks to the sale of MoPub, we will be able to pay more attention to advertising on our website and in our applications. We plan to accelerate the development of our own product and compensate for lost revenue in a short time. After its launch, we hope to at least double the total annual revenue from $3.7 billion in 2020 to $7.5 billion or more in 2023,” Segal explained.
For AppLovin, the purchase of MoPub is strategic. According to representatives of the technology company, the deal is beneficial to both their partners and customers. Publishers will be able to increase revenue by increasing demand and increasing competition for each ad impression. And advertisers will be able to expand audience reach to “hundreds of millions of new consumers at market prices.”
AppLovin also noted that it will transfer the main functions of MoPub to the MAX platform. Perhaps this means that MoPub itself will cease to exist.
How did the industry react
The reaction to the purchase of MoPub was not long in coming. Jude O’Connor, AdColony’s chief financial officer, was one of the first to draw attention to her. She noted that the deal has a “side effect”. They say that because of it, advertisers will lose another independent player to whom they could turn to reach consumers. O’Connor also stated that advertisers have a clear line between partnering with a strong advertising company and “placing bids in a fully vertically integrated, self-attributing black box.”
Kunal Nagpal from InMobi said he was interested to see how game publishers would react to this deal. AppLovin is a competitor for them, as it owns 12 studios and operates more than 200 games. This may affect the advertising side of the company’s work.
According to marketing expert Eric Seufert, the purchase of MoPub corresponds to AppLovin’s strategy. The company intends to get as much data as possible, the availability of which will become a competitive advantage for it not only as an advertising platform, but also as a publisher. As part of this strategy, AppLovin previously bought MAX, a platform for monetization of mobile applications.
The deal comes in the post-IDFA era, when Apple essentially banned the use of this advertising identifier on iOS. MoPub will open AppLovin access to the existing client base of publishers and will allow real-time tracking of data on each advertising impression made on behalf of publishers.
MoPub has been working under the leadership of Twitter since 2013. Last year, she earned over $188 million. This advertising network is not the only such acquisition of AppLovin recently. In the winter, AppLovin also announced the takeover of Adjust, specializing in mobile analytics.