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Summary
- Magnite aims to build a leading interactive advertising platform with the help of this acquisition
- Magnite and SpotX together shall revolutionise the market with the best CTV technologies.
Magnite Inc (NASDAQ:MGNI), one of the largest independent sell-side advertising forums, has signed an agreement to buy SpotX, a video advertising group from RTL Group, a European broadcasting group for a whopping amount of $1.17 billion in the form of shares and cash. Notably, SpotX provides top-notch solutions that are shaping the realm of video advertisement and Connected TV. According to the deal, Magnite is expected to offer 14 million shares and pay $560 million in cash to RTL Group.
The acquisition is set to revolutionise the programmatic marketplace as the deal could lead to one of the largest independent CTV and video advertising platforms. The new entity is expected to expand the scale and enhance the productivity for buyers as the combined synergies would lead to an alternative to the CTV advertising market’s largest players and better support for sellers.
Connected TV technology is the future of home entertainment. The television industry has been evolving rapidly. Traditional cable TVs are getting replaced by Internet powered TVs. OTT (Over the Top) applications have become very popular among the millennials.
With the transformation of smart TVs and receivers, the advertising services also need an upgrade. Connected TV technology is an ideal method to integrate interactive digital advertising services. Magnite aims to tap this opportunity and expand its foothold in CTV offerings by buying SpotX. Ad-supported CTV offerings shall prove to be an important growth driver across the industry. From a marketeer’s perspective, the acquisition will make it easier for marketing agencies to get easy access to a pool of audiences by buying premium CTV inventory at scale.
Magnite has also launched a solution that empowers CTV and OTT publishers Unified Decisioning. From the demand side’s perspective, online display advertising based buyers and brands will now have an equal opportunity to vie for premium video content and will also have greater insight into available inventory.
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The CTV and OTT publishers now do not need to manage direct sold and programmatic demand channels independently and can maximise their yield. The Unified Decisioning empowers the publishers to control the programmatic demand.
Shares of Magnite Inc have delivered a double-digit price return of 55.32 per cent. Magnite feeds on revenue coming from advertisements. As the businesses are in the recovery mode, the marketeers will ease their spending on promoting their businesses. The revenue for advertisement is coming back as the company’s total revenues were up by 12 per cent in November.
