After weeks of rumors, Facebook today announced it will buy the Atlas Advertiser Suite away from Microsoft. Despite rumors, Facebook said it didn’t buy Atlas to launch an ad network, but to help advertisers “close the loop” and understand how their spend earns them money. The Seattle-based Atlas team will stay put, but Facebook plans to invest in back-end scaling and better measurement.
Discussions between the tech giants were first reported by Business Insider in December. AdAge has been closely following the story and provided many leaked details, including that Microsoft had been aggressively searching for a buyer and that the price was to be less than $100 million, following previous bids in the $30 million to $50 million range. Microsoft originally acquired Atlas through a $6.2 billion purchase of its parent company aQuantive, which also owned Avenue A / Razorfish and DRIVE Performance Solutions.
Now the acquisition is official, though no price was announced. One of my sources says that, in the end, Facebook paid closer to $50 million than $100 million. The deal should keep relations between the two companies warm and toasty, as it’s been years since they got in bed together and Bing started powering web search within the social network.
Atlas allows advertisers to plan campaigns, buy ads on sites across the web, and measure their impact. It can handle search, rich media and in-stream video, and display ads, as well as offer APIs for programmatic control of big campaigns.
This afternoon I spoke to Brian Boland, head of monetization product marketing at Facebook, and Dave O’Hara, the CFO of Microsoft’s online services. Boland started by bluntly denying speculation, saying “Why we’re doing this is not to launch an ad network, and why we did do this is to improve measurement. We heard loud and clear from advertisers that they want to understand multi-touch attribution instead of just looking at the last click.”
Facebook now owns the infrastructure and knows how to launch its own full-fledged offsite ad network, which would let it monetize its personal information about 1 billion people by targeting them with ads across the web. But that’s not the plan, according to Boland.
Facebook will gain a huge slew of clients from the deal, and many advertisers who already work with the social network will gain a more holistic view of their marketing campaigns. Facebook can now take advantage of Atlas’ presence in serving ads across the web to track attribution of how offsite ads lead to purchases. Advertisers may be willing to pay higher ad prices through Facebook or Atlas to get a bird’s-eye view of their real performance. The synergies could also help Atlas compete better with Google’s DoubleClick, which had pulled ahead over the last few years.
Those who shouldn’t fear include Facebook’s existing ads API partners like AdParlor, Optimal Kenshoo, Nanigans, Salesforce, and BLiNQ Media. Boland tells me “We think [Atlas is] complementary,” noting that Facebook is fundamentally an ecosystem company and wants third-party adtech companies to continue investing in building tools and services for its platform. Optimal CEO Rob Leathern agreed, saying “I don’t believe [the acquisition of Atlas] is threatening to Ads API partners. Rather it may open up a new set of opportunities for partners like optimal to help optimize additional pieces of publisher inventory added to the larger Facebook ‘graph’.”
Boland also said the deal shouldn’t worry demand-side platforms that enable advertisers to buy Facebook Exchange real-time bid cookie-retargeted ads. Atlas will continue to be for buying ads across the web, not on Facebook where ads API and FBX DSPs operate. In an interesting twist, O’Hara confirms Microsoft will now be a customer of Facebook, as it uses Atlas to measure ads it runs on MSN and other properties it owns.
Facebook plans to use Atlas to pioneer advances in ad measurement on the small screen. Boland tells me “The ability to understand ROI on mobile is nascent right now. As advertisers increase their investment in mobile, it’s something they have to know.” He hinted that because you use the same Facebook ID on the web and mobile, the social network will be able to tie together your actions across devices to show how ads on your laptop influence purchase behavior on your phone or tablet and vice versa.
Overall, it seems like a smart deal. Advertisers want to digitize their budgets, but are worried about burning cash without understanding what they get back. By combining Atlas data with that from Nielsen and Datalogix, Facebook could give businesses a way to see exactly how their online ads drive on and offline spend.
You can read the full announcement of the deal below:
Facebook to Acquire Atlas from Microsoft
We’re pleased to announce that we have agreed to acquire the Atlas Advertiser Suite from Microsoft. Atlas is a leader in campaign management and measurement for marketers and agencies. We believe this acquisition will benefit both marketers and users, and we’d like to explain why.
Today’s marketing environment is much more complex than it was just a few short years ago. Marketers and agencies struggle to understand how their efforts across different channels complement and strengthen each other. Consequently, they are forced to adopt siloed marketing strategies for each channel, leading to poor and inconsistent end-user experiences.
This challenge also provides an opportunity. If marketers and agencies can get a holistic view of campaign performance, they will be able to do a much better job of making sure the right messages get in front of the right people at the right time. Atlas has built capabilities that allow for this kind of measurement, and enhancing these systems will give marketers a deeper understanding of effectiveness and lead to better digital advertising experiences for consumers.
Many marketers that advertise on Facebook today use Atlas, and Atlas has been an approved partner for measurement since June. Today’s agreement brings us closer together in a way that benefits both Facebook and Atlas’ agency and marketer clients. Atlas clients should not see any change to the service they receive today, and we will continue to innovate and invest in the Atlas platform.
We plan to improve Atlas’ capabilities by investing in scaling its back-end measurement systems and enhancing its current suite of advertiser tools on desktop and mobile. We will also work to improve the user interface and functionality with the goal of making Atlas the most effective, intuitive, and powerful ad serving, management and measurement platform in the industry. Ultimately, Atlas’s powerful platform, combined with Nielsen and Datalogix, will help advertisers close the loop and compare their Facebook campaigns to the rest of their ad spend across the web on desktop and mobile.
Our belief is that measuring various touch points in the marketing funnel will help advertisers to see a more complete view of the effectiveness of their campaigns. Acquiring Atlas will be an important step towards achieving this goal.
Atlas is based in Seattle and the team will continue to operate from there. Our Seattle engineering office already drives important parts of our ad system, and we plan to substantially invest in and build out our Seattle engineering and product teams. We look forward to further building out the Atlas platform to help marketers better understand how well their campaigns perform, and to help them optimize their campaigns.
We look forward to welcoming the Atlas team.
Facebook is the world’s largest social network, with over 1 billion monthly active users. Facebook was founded by Mark Zuckerberg in February 2004, initially as an exclusive network for Harvard students. It was a huge hit: in 2 weeks, half of the schools in the Boston area began demanding a Facebook network. Zuckerberg immediately recruited his friends Dustin Moskovitz, Chris Hughes, and Eduardo Saverin to help build Facebook, and within four months, Facebook added 30 more college networks. The original...