The Value of Numbers: Why did Yahoo Purchase Flurry

Yahoo has been in an acquisitive mood as of the past two years, their purchase of Tumblr, the ascendant microblogging platform, was widely viewed as a good strategic move and, while their ad platform certainly requires something of an overhaul if it’s to challenge the likes of Google Adwords, it’s a step in the right direction. This must be viewed in the context of their recent purchases of Israeli startup RayV, who specialize in streaming services and their launch of “Live Nation Channel”, primarily aimed towards delivering high-end music content to consumers.

Yahoo’s purchase of Flurry is part of this larger attempt on Yahoo’s part to re-orientate themselves away from being a traditional search-engine based company towards content delivery, particularly on mobile platforms. Flurry is part of this in that it’s an analytics platform that has been extraordinarily well received amongst app developers, advertisers and marketers for Android and iOS, delivering excellent, easily digestible data.

While no exact figures were released concerning the cost of the acquisition, it’s clear Flurry forms part of a two pronged strategy for Yahoo: On the one hand acquiring companies that facilitate the deployment of content, such as RayV, as well as investing more in creating their own content (their relaunch of the Yahoo Travel digital magazine is a good illustration of this), while on the other hand getting hold of a respected analytics package (some half a million apps use Flurry across all operating systems and, crucially, it tracks more mobile phones than Google or Facebook) that provide marketers and other investors with solid data, something that was lacking previously.

The acquisition will, as mentioned, be of particular interest to potential advertisers on Yahoo’s growing list of mobile real estate. It’s a long-game strategy, as mobile ads aren’t without their drawbacks, and critics point to perceived lower engagement from consumers as evidence of this. However, Gartner recently forecast that the mobile advertising market would be worth some $42 billion by 2017 and this acquisition, along with Yahoo’s general mobile-centric strategy as of late, puts them in a good position to capitalize on that growth, challenging key competitors like Google and Facebook with their own portfolio of products and services.

However, it should be kept in mind that Yahoo aren’t operating in a vacuum on this front. We’ve already seen a lot of activity on the mobile ad acquisition front, with Opera Mediaworks purchasing AdColony and social-media giant Twitter buying TapCommerce and we’re likely to see this drive even more acquisition, even amongst companies that rely largely upon big in-house analytics teams and developers, such as the aforementioned Facebook and Google.

Categories: Industry opinion

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