Sticking with big name technology stocks
Amazon.com Inc. (AMZN.O) is close to an agreement to buy the ad-serving technology of bankrupt company Sizmek Inc. in a deal that would give the e-commerce giant another weapon against Google’s dominant online ad business.
The purchase could be announced as soon as this week, according to two people briefed on the matter. The deal hasn’t been finalized, said the people, who asked not to be named because discussions are still in progress. Representatives of Amazon and Sizmek declined to comment.
Sizmek has been selling off businesses as part of bankruptcy proceedings it initiated in March. At the time, Sizmek estimated its assets were worth US$100 million to US$500 million, and it has already sold some pieces to Zeta Global Holdings Corp. for around US$36 million.
Sizmek’s Ad Server, which helps advertisers place spots around the internet and measure their effectiveness, competes directly with Google’s Marketing Platform, formerly known as DoubleClick. Scooping up ad-serving technology would bolster the pitch Seattle-based Amazon is making to advertisers to persuade them to shift money to its platform.
“Amazon will now have a comprehensive offering to go against Google and Facebook,” said Doug Rozen, chief media officer at advertising agency 360i. “The addition of Sizmek could be the start of a needed shift beyond a duopoly.”
Amazon’s digital advertising business is still small compared with Google’s and Facebook Inc.’s, but it’s growing faster. The company’s "other" revenue segment, which is mostly advertising, grew 34 per cent to US$2.72 billion in the first quarter compared with a year earlier. Google’s advertising business grew 15 per cent in the same period, the slowest pace since 2015.