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Comcast Dealing For FreeWheel

Comcast is closing in the acquisition of FreeWheel, a top provider of online advertising campaign management platforms that counts NBCUniversal among its clients, sources confirmed.

TechCrunch first reported Saturday that Comcast has a deal in place to acquire San Mateo, Calif.-based FreeWheel for about $320 million, with a formal announcement expected soon.

Sources confirmed that FreeWheel and Comcast have been in M&A discussions, but said it is not clear if they had finalized the agreement. Two people familiar with the deal verified that Comcast has agreed to acquire FreeWheel for the $320 million reported by TechCrunch.

“The number is right and there is a deal in play,” one source said. 

FreeWheel and Comcast declined to comment.

In FreeWheel, Comcast would obtain a popular online ad platform that the MSO and its programming partners could use to drive more revenue out of broadband-delivered content, including TV shows distributed via authenticated TV Everywhere applications. FreeWheel would also give Comcast an advertising element to offer alongside the the online video publishing capabilities it has via thePlatform, the Seattle-based firm Comcast acquired in 2006.

Founded in 2007, FreeWheel has built up a significant client base made up of major programmers, media brands, and distribution partners, including NBCU, Fox, Turner, AOL, Sky, Dish Network, Discovery Communications, DirecTV, Vevo, AT&T, Viacom, A+E Networks, Crackle, and Revision3, among others. Investors include Steamboat Ventures, Turner Broadcasting System, Battery Ventures, Foundation Capital, and DirecTV, which announced it had taken an equity ownership stake in the company in January 2013. FreeWheel has raised about $37 million, according to CrunchBase.

A person familiar with the deal also confirmed that it is Comcast’s desire for FreeWheel to operate independently and to continue serving its clients. If that’s the case, the deal would seem to follow closely with the approach Comcast has used with thePlatform.

As a maker of campaign management platforms, FreeWheel’s competitors include Black Arrow, DoubleClick (acquired by Google in 2007 for $3.1 billion), and Auditude (acquired in 2011 by Adobe Systems).

With a Comcast/FreeWheel deal said to be in the making, a big question is where it would leave Black Arrow, which counts both Comcast and Time Warner Cable as investors and deployment partners. At this point, however, the present deployment focus of FreeWheel (online) and Black Arrow (set-top-based VOD advertising) appears to be complementary. It's not clear yet whether Comcast would eventually look to unify its online and set-top ad campaign management systems.