China Continues Buying Up US Firms; Mitch McConnell Sides With Cable Cos. On Cable Boxes

Here’s today’s AdExchanger.com news round-up… Want it by email? Sign-up here.

Over The Wall

It looks like Chinese companies will continue gobbling up US ad tech firms (see: Smaato and Opera). China faces heavy competition in its domestic market, where internet traffic is shared among power players with closed APIs like Tencent, Baidu, Alibaba and Qihoo 360. American companies are cheap grabs for Chinese investors, who benefit from saturation in the US ad tech market. “From Chinese investors’ point of view, tech companies in the US are undervalued because it’s hard for them to exit,” Si Shen, CEO of PapayaMobile, told Digiday. “Those firms can get much more funding from private equities in the Chinese capital market, so the [purchase] price is very reasonable.” More at Digiday.

Unlock This

Senate Majority Leader Mitch McConnell is siding with cable companies and the ad industry in the battle over set-top boxes. As Ad Age reports, the ANA has said unlocking the cable box “would hurt advertisers’ ability to target key audiences and cause confusion regarding offers or promotions as ads reach geographic regions where such offers may not be available.” Read the story. The opposite could also happen: Targeting improves with more open hardware competition, leading to better matching of offers to households. Not surprisingly, Google is in the “unlock the box” camp.

Heavy Weather

Everyone knows IBM was most interested in The Weather Co.’s data assets (not its ad business) when it plunked down $2 billion for the company last year. Yesterday it tipped its hand somewhat, unveiling a Watson-powered weather forecasting service dubbed Deep Thunder. MarketWatch reports that the “hyperlocal weather forecast … will provide enterprise clients with short-term customized forecasts” (with accuracy to within 0.2 miles) that can help with things like retail stocking and marketing decisions. The other shoe to drop is TWC’s immense location data asset, courtesy of its ubiquitous apps, which could allow Watson customers to know real-time migrations. More.

Spoiled Rotten

The future of ad-supported TV may hinge on one company’s success. Netflix content chief Ted Sarandos tells The New York Times, “The shows and movies [people] want to watch are subject to business models they do not understand and do not care about. All they know is frustration.” That, according to Sarandos, “is the insight Netflix is built on.” Netflix now has 81 million subscribers globally and $6.8 billion in revenue. Yet profits are tiny, and the company may yet need to reckon with its hard line on advertising. Read the story. See also: Amazon Instant Video.

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