Roku to acquire demand-side platform Dataxu for $150m

OTT provider said acquisition will help it unlock more advertising investment.

Roku: top TV streaming platform by hours in US
Roku: top TV streaming platform by hours in US

Roku is buying demand-side platform Dataxu for $150m (£115m) in cash and stock, as part of a growing movement from TV platforms to build in-house advertising capabilities.

The acquisition agreement has been approved by each company’s board of directors and is anticipated to close in the fourth quarter, subject to regulatory approvals.

Dataxu has been doubling down on its advanced TV capabilities in recent years, with TV advertising now making up the majority of its revenue. The Boston-based business provides technology to Viacom and Sky in the UK, and is the default targeting and measurement solution for OpenAP, a TV data consortium backed by Fox, Viacom and NBCUniversal.

Roku is the top TV streaming platform by hours in the US, according to a June 2019 comScore analysis, and has 30.5 million active users.

Announcing the deal, Roku said the adtech group will allow it to provide marketers with a single data-driven software solution to plan, buy and optimise adspend across TV and over-the-top providers.

It noted that the market for OTT advertising will continue to expand "as viewers continue to migrate to streaming". Today, advertisers spend more than $70bn on traditional TV. OTT viewing accounts for only 29% of TV viewing, but has so far only captured 3% of TV ad budgets, according to Magna Global.

"TV advertising is shifting toward OTT and a data-driven model focused on business outcomes for brands," Anthony Wood, chief executive officer at Roku, said in a statement. "The acquisition of Dataxu will accelerate our ad platform while also helping our content partners monetise their inventory even more effectively."

TV platforms around the world are either acquiring or building up their advertising capabilities in-house to scoop more TV budgets. AT&T, which owns media conglomerate WarnerMedia, bought AppNexus last year and subsequently merged it into Xandr, while Malaysia's Iflix has been rapidly growing its ad capabilities through a string of partnerships.

A version of this article first appeared in Campaign Asia-Pacific

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