Yahoo announced today that it will acquire the 80% of advertising network RightMedia that it doesn’t already own for $680 million in cash and Yahoo stock. (Yahoo already owned 20 percent of the company, putting the total valuation at $850 million).
Yahoo previously bought 20% of the company in a $45 million Series B round of funding announced in October 2006. The company has raised over $50 million to date.
This move counters Google’s acquisition of DoubleClick earlier this month for $3.1 billion, and signals that Yahoo wants more weapons in its arsenal to fight the ongoing online advertising war beyond their new Panama release.
RightMedia runs an advertising marketplace that allows for much more efficient advertsing pricing than older negotiated models (something still in the planning stages at DoubleClick). See our coverage of their RMX Direct product from August 2005.
RightMedia also tends to work with large intermediate ad brokers and addresses the short tail of the ad market (as does DoubleClick), whereas Overture and Adsense are definitely long tail products with many smaller advertisers and publishers.
Founded in 2003, Right Media is a Yahoo! company based in New York, with offices in London, Moscow, Eugene, San Francisco and Tallahassee. Right Media is the host of the Right Media Exchange, launched in 2005. The Right Media Exchange platform connects digital advertising companies and provides an opportunity for these participants to reach their audiences on their own terms. RMX is a holistic marketplace for managing an ad business–from full ad serving, to business development, to business expansion.
Yahoo was founded in 1994 by Stanford Ph.D. students David Filo and Jerry Yang. It has since evolved into a major internet brand with search, content verticals, and other web services. Yahoo! Inc. (Yahoo!), incorporated in 1995, is a global Internet brand. To users, the Company provides owned and operated online properties and services (Yahoo! Properties, Offerings, or Owned and Operated sites). Yahoo! also extends its marketing platform and access to Internet users beyond Yahoo! Properties through its distribution network...