Home Ad Exchange News SintecMedia Buys Operative For $200 Million In Push Toward TV-Digital Convergence

SintecMedia Buys Operative For $200 Million In Push Toward TV-Digital Convergence

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sintecmedia-operativeSintecMedia will acquire Operative for nearly $200 million in a move that will give media companies with linear TV and digital businesses one software system to manage proposals, trafficking and billing.

“We are future-proofing [media companies’] businesses by helping them create a single stack for linear and digital,” said Operative CEO Lorne Brown, who will serve as president of SintecMedia post-acquisition.

SintecMedia offers planning, trafficking, billing and content management tools for linear TV companies, while Operative focuses on the same tools for digital. The two companies together serve about 500 large media companies and even share some clients, including NBCUniversal.

As linear TV moves from GRPs to audience-based buying, TV companies know they need to embrace the yield and audience-planning tools of digital.

“It’s really easy to buy video using audiences with Facebook,” Brown said. “If TV companies are to compete in this environment, their data needs to be moved upstream into a single environment.”

The deal was inspired by SintecMedia clients, said CEO Amotz Yarden.

“We heard from our customers many times that we should join together and become one company,” Yarden said.

When private equity firm Francisco Partners acquired SintecMedia for around $400 million in April, the two groups discussed the possibility of acquiring a digital planning software tool to address the convergence between digital and TV.

“Operative was at the top of the list,” Yarden said.

The companies’ software overlaps very little, Brown said. In early 2017 they will combine the proposal system, which will enable media companies to respond to linear TV and digital RFPs holistically, for example.

Local TV broadcasters and MVPDs, which sell both linear TV and digital to regional advertisers, are most ready to embrace this tech, according to Brown. National media companies may be selling to separate ad agencies now, but they already need tools to manage tests of audience-based buys.

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“Unequivocally, everyone is ready for convergence one way or another,” Brown said.

The combined companies have at least one competitor: WideOrbit, which manages ads across digital, TV, radio and programmatic.

“This is a powerful combination,” said GCA Advisors managing director Joshua Wepman, the bank advising Operative on the deal. “I don’t know if there is anyone with this much scale covering TV, digital, programmatic and non-programmatic.”

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