Underscoring the significance of data in an OTT video world, Bertelsmann-owned European media group RTL has acquired advertising technology supplier Yospace for $33 million – to tighten its ad-driven streaming ship. The UK-based vendor is an expert in stitching replacement ads into multi-platform services in a way that it claims replicates original broadcast channels, and the mounting pressure on the broadcast industry suggests consolidation in ad tech could become a running theme.
Others could learn a lot from RTL, one of Europe’s most advanced and forward-thinking media groups in advertising technologies. Its entire ad platform has undergone an overhaul within the past year, after it completed the merger of the two online programmatic ad sales platforms SpotX and Smartclip last February, shortly after terminating its ad tech contract with video software vendor Ooyala.
RTL talks about Yospace being an important step in building out its Total Video portfolio, another name for its AdConnect advertising sales house, and it complements the ad tech stack for scaling premium media clients like RTL’s own broadcasters and streaming services. Total Video/AdConnect comprises three products; RTL AdPremium which offers access to RTL’s family of VoD services; RTL AdEx which includes ad inventory sold via SpotX and Smartclip; and RTL AdAffinity which provides access to videos around influencers on multi-platform networks.
The Connected TV space has been a core target area for SpotX since its acquisition by RTL in summer 2017 and we can see Yospace being pushed in a similar direction. Most connected TV ad inventory today is available in private marketplaces, but various ad tech suppliers are getting their hands on connected TV programmatic inventory.
We feel $33 million is a fair price for a company with several major UK deals with Sky, BT Sport and ITV, as well as some unnamed media customers in the US and Asia.
Yospace’s method of server-side dynamic ad insertion goes about business while allowing full addressability so the relevance of the ad to the user is not lost. Its server side ad stitching also helps beat ad blockers and delivers programmatic ads across multiple streaming protocols, while also allowing insertion of unskippable ads.
Recently, in November, Yospace demonstrated how combining a reduction in ad load with addressable advertising can improve viewer engagement for broadcasters offering OTT video, particularly for millennials. Yospace developed its Non-Linear Startover (NLSO) technology to allow users to rewind live content mid-stream, and ad breaks are then reduced in length meaning viewers can catch up with the live action. But size doesn’t matter, Yospace assures, as precise per-viewer decisioning means broadcasters can command a premium for advertising. Belgian broadcaster Medialaan is the first to use the technology.
Perhaps we should have seen the acquisition coming, as RTL subsidiary SpotX is of a similar ilk to Yospace and the two have teamed on numerous joint projects to address issues facing the TV advertising industry.
One such collaboration involved addressing the challenges in matching ads with live audiences, which is a particularly difficult feat with live sports content where as much as 90% of the audience don’t log on until 5 minutes before kick-off and then immediately switch off the screen as the final whistle blows. So, SpotX took its video inventory management platform, which allows broadcasters and advertisers to send personalized ads based on age and gender data sets, and combined this with Yospace’s technology to ultimately help BT Sport monetize live sports content via server side ad stitching.
RTL CEO Bert Habets said, “First, we gain a competitive, fully integrated and profitable solution which is key to further grow our ad-tech business. Our goal is to continue expanding SpotX into a leading, independent monetization platform for broadcasters, video on demand services and publishers. Secondly, this acquisition will also help build local streaming champions in the markets where we have strong families of channels. The Yospace technology makes advertising on streaming services more personal, which means a better consumer experience for superior monetization of our premium advertising inventory.”
We might be losing an exciting player from our radar but there could still be a bright future ahead for Yospace, considering SpotX has reported expanding its footprint by 40% outside of the US thanks to RTL and Smartclip.