Search engine Yahoo! has closed its nearly $700 million acquisition of online ad exchange Right Media, the company announced late last week.
New York-based Right Media operates a marketplace that lets Web publishers auction space for display ads to the highest-bidding advertisers. For bringing the parties together, Right Media collects a commission, usually 7% of the sale.
Yahoo! bought a 20% stake in the company last August and then announced in April that it would acquire the remaining stock for $680 million in a cash-and-stock deal. By purchase time, a falloff in Yahoo!’s stock price reportedly brought the price down to about $650 million.
Unlike the search marketing arena, where Google holds a commanding lead, Yahoo! has long been the strongest seller of graphic ads. But the display ad market has not gone through the same automation and organization that made search ads so easy to buy and deliver. Ad exchanges such as Right Media may be key to unlocking new growth in display ads, and possibly in rich media and video ads as well.
Ad network DoubleClick, currently the target of a buyout by Google, announced last April the launch of its own display ad exchange.
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