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Ad Firm BlackArrow Is Mulling Its Future

BlackArrow, an advanced advertising company that counts Comcast and Time Warner Cable as investors, has hired advisers to help it pursue a range of strategic options that could include an eventual sale, industry sources said.

One source familiar with the situation said several “future actions” are on the table, including the aforementioned sale and acquisitions of other vendors that can flesh out the company’s product scope. But the source warned that no deals are imminent.

“We do not comment on rumors and speculation,” a BlackArrow official said.

BlackArrow has historically been focused on dynamic ad insertion on QAM-based set-top boxes, and recently evolved its platform to support Nielsen’s On Demand Commercial Ratings (ODCR), a method of viewership measurement that Comcast has been testing that allows advertisers to splice fresh spots dynamically into recently aired TV shows as well as other prior episodes in the current TV season.

Last week, Comcast announced an ODCR-pointing deal with Turner Broadcasting System that covers traditional set-tops, as well as IP-connected devices such as tablets and smartphones. While BlackArrow and the operator-backed Canoe joint venture would handle ad insertion on QAM set-tops, other vendors, including FreeWheel and This Technology, would be among those that would pitch in on the IP end of the equation.

BlackArrow is well-positioned to support advanced advertising at the set-top level as that market begins to accelerate. At last check, its software is being used for DAI on boxes that reach 30 million homes, thanks in large part to deployments with Comcast and Time Warner Cable, which are part of Canoe, and Rogers Communications. Cox Communications and Bright House, the other two Canoe backers, are expected to get going with Canoe’s DAI platform later this year.

Looking ahead, support for IPbased multiscreen video services and data analytics for use toward targeted advertising are among the products that BlackArrow has identifi ed on its roadmap.

But BlackArrow’s future position, particularly when it comes to IPdelivered video at Comcast, came under some question in March, when the nation’s largest cable operator acquired FreeWheel, a company that specializes in online advertising campaign systems. FreeWheel is expected to continue to operate independently, following the sort of structure that Comcast put in place when it bought video publishing firm thePlatform in 2006.

If BlackArrow does seek a sale, its dilution level could present a bit of a challenge, as an expanded Series C round in 2011 extended the total amount raised by the company to $65 million. BlackArrow’s investors include Comcast Ventures, Cisco Systems, TWC, Motorola Mobility (now part of Google), Intel Capital, Mayfield Fund and Polaris Partners.

Snapshot: BlackArrow

Founded: 2005

CEO: Dean Denhart

Funding: $65 Million

Customers: Comcast, Rogers Communications and Time Warner Cable, among others

SOURCE:Multichannel News research