Australia's Adconion Media Group Makes ‘Land Grab’ for Connected TV Video Advertising Market - Acquires Germany's Smartclip

written by: Richard Kastelein

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Adconion Media Group has affirmed its position as a market leader in online video advertising following its announcement today that it has acquired smartclip, Europe’s largest provider of digital video advertising. The impact on Adconion’s Australian operation will be immediate, with smartclip’s global distribution partners increasing the volume of exclusive in-stream inventory available across Joost, Adconion’s Digital Distribution Platform for brand advertising.

This strategic acquisition will significantly strengthen Adconion’s position and growth in its existing markets and accelerate the deployment of its technology into the emerging segment of Connected TV. smartclip’s proprietary Connected TV technology will be added into the Joost platform, which is already integrated with TV app providers, set-top boxes and gaming consoles.

According to IAB Australia’s most recent Online Advertising Expenditure Report, the online video market was worth $38.8 million in the year ending 30th June 2011, with the market growing at 53 percent year on year. Prior to this acquisition Adconion held approximately 20 percent market share of the online video market.

According to Alex Littlejohn, President APAC of Adconion Media Group, this announcement will shake up the Australian video market considerably as agencies and advertisers are demanding the opportunity to distribute more content across more platforms than ever before.

“Prior to the acquisition, the Joost video platform reached 5.7 million Australians online. With the addition of smartclip we expect this to grow by 30-40 percent,” said Littlejohn.

“The video and web TV market is incredibly competitive and there is an extreme shortfall of quality in-stream inventory. We’re seeing the same market evolution in video inventory that we experienced in display several years ago. Opportunistic broker networks are popping up everyday and are focused only on arbitrage, brokering the same real estate and essentially adding no value to the advertisers, publishers or content partners.

“This acquisition of smartclip strengthens our position and will accelerate the ongoing development of online video and digital TV in Australia. As more exclusive audience is aggregated by top-tier players it will be harder for the brokers to co-exist,” said Littlejohn.

smartclip brings more than 500 publisher sites to the Adconion portfolio, including Sony Music, News International, BBC, SBS, Discovery Channel and Viacom. smartclip’s technology standardizes different online video advertising formats across multiple devices and publisher sites, connecting relevant advertisers to premium content and websites offering highly efficient video campaigns. Its superior ad products, which support multiple technical specifications, will be immediately integrated into Joost. Adconion’s creative and branded entertainment company RedLever, will support the new opportunities, producing branded content to meet the increased demand of online video.

100 percent of new TVs can now connect to the Internet via a set-top device or through new smart TV devices produced by the major manufacturers. By 2014, it is expected there will be 1.6 billion Connected TVs worldwide, with 250million installed with an embedded app platform and store. smartclip will enable Adconion Media Group exclusive access to sell advertising in over 70 apps that have been preloaded onto Connected TVs.

“The Adconion vision has always been to enable advertisers to reach the same consumers across multiple platforms. Integrating smartclip’s technology with our own and taking it global is another significant step towards that goal. Both parties understand the evolution of media consumption and are committed to delivering advertisers solutions for a digitally merged TV and online video experience.” said Littlejohn.

“We believe that advertisers and agencies will welcome Connected TV as it will provide new inventory sources and new audiences for their content. We see this accelerating the growth of brand budgets migrating from TV to online and bringing digital into the lounge room. It’s also exciting to be able to give viewers greater control of the content they consume. Connected TV is destined to change the way audiences consume content on television and Adconion is paving the way forward in this market,” said Littlejohn.

With the acquisition of smartclip, Adconion will gain 118 employees and grow its global footprint to 27 offices across 17 countries.

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