AT&T said Tuesday that it had found a buyer for its programmatic advertising unit Xandr in the form of software giant Microsoft, for an undisclosed sum.
Xandr was created after AT&T bought ad company AppNexus for $1.6 billion in 2018 and combined it with existing ad-tech operations. AT&T renamed the advertising unit Xandr after its founder Alexander Graham Bell.
Although AT&T said it would keep Xandr after the merger of its WarnerMedia Group with Discovery, speculation has been high that the ad business was on the block. The unit had been on the block even before AT&T's surprise decision in May to spin off its WarnerMedia unit and merge it with Discovery Inc., a transaction that is still on the way to closing. Last year, Xandr CEO Brian Lesser and other senior executives left the company, and the unit's platform and media assets were split up, with the media assets merged into WarnerMedia.
AT&T in February also sold a minority stake in its satellite-TV business, DirecTV, to TPG, pivoting toward streaming and further away from traditional pay TV.
“Microsoft’s shared vision of empowering a free and open web and championing an open industry alternative via a global advertising marketplace makes it a great fit for Xandr. We look forward to using our innovative platform to help accelerate Microsoft’s digital advertising and retail media capabilities,” said Xandr’s EVP and GM Mike Welch in a press release.
The transaction is subject to closing conditions and regulatory reviews. Microsoft is expected to use Xandr’s technology to complement its current advertising offerings.
“With Xandr’s talent and technology, Microsoft can accelerate the delivery of its digital advertising and retail media solutions, shaping tomorrow’s digital ad marketplace into one that respects consumer privacy preferences, understands publishers’ relationships with consumers and helps advertisers meet their goals,“ said Microsoft president of Web Experiences Mikhail Parakhin in a press release. ■
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Mike Farrell is senior content producer, finance for Multichannel News/B+C, covering finance, operations and M&A at cable operators and networks across the industry. He joined Multichannel News in September 1998 and has written about major deals and top players in the business ever since. He also writes the On The Money blog, offering deeper dives into a wide variety of topics including, retransmission consent, regional sports networks,and streaming video. In 2015 he won the Jesse H. Neal Award for Best Profile, an in-depth look at the Syfy Network’s Sharknado franchise and its impact on the industry.