Australian Telco Telstra Acquires Majority Stake In Video Platform Ooyala

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seanAustralian telco Telstra has acquired video-monetization, streaming-video and content-management company Ooyala, the companies revealed Monday.

Telstra had already invested $61 million for a 23% stake in Ooyala, which works with supply-side inventory partners and publishers to help monetize video content, and now owns 98% for an additional $270 million investment. Read the release.

The acquisition, which is expected to close in 60 days, reflects a growing need for technology that can handle the conflation of online video and TV inventory.

"As the world's collective definition of TV and video blurs across multiple devices and a more personalized viewing experience, the technologies and measurement tools for content delivery and monetization will evolve," Ooyala CEO Jay Fulcher wrote in a post announcing the acquisition.

Fulcher will continue in his current role and will serve on the board of directors along with Ooyala EVP and co-founder Sean Knapp. Ooyala will have its own board and it will operate under separate governance from Telstra.

Knapp told AdExchanger in a recent interview that the company wants "to be to TV what Cisco is to network computing." One of the questions Ooyala helps broadcasters and publishers answer is how to "maximize user retention, [knowing that] if you monetize a user too aggressively, they leave. But if you monetize them right and you retain them and you generate the highest amount of revenue, that ultimately reinforces the 'creation' side of your business, which is what everybody benefits from."

This acquisition is yet another example of an APAC telco buying a Western ad tech company. Singapore Telecommunications (Singtel) recently snapped up ad network Kontera and cross-channel advertising company Adconion to ramp up its mobile ads division Amobee. These moves recall a prediction by Richard Nunn, a former investment banker and COO of UK-based video ads platform Coull: "Over the next 18 months, you'll see some big buyers in the East buying Western-based technology businesses."

Ooyala has 330 employees and 45% of its business is international. Founded in 2007, companies that use the Ooyala Platform and services to monetize their video assets include ESPN, Univision and Yahoo Japan.

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