Peter Kafka

Recent Posts by Peter Kafka

With AdMob Out of the Way, Is Google Set to Buy Invite Media?

Now that Google has wrapped up its AdMob deal, what’s next on its shopping list? One good bet: Ad tech start-up Invite Media.

Industry sources believe Google (GOOG) is close to a deal for Invite, a three-year-old “demand side platform” designed to help buyers navigate high-volume display-advertising exchanges–like the one Google launched last year.

A deal has supposedly been in the works for some time, and one theory is that Google has been waiting for the AdMob saga to conclude before moving forward. Estimates for a price are all over the map, ranging from $60 million to $100 million.

The caveat: Google’s name has been linked to various DSPs for several months.

“We have not entered into any agreement with any company,” Invite CEO Nat Turner told me via email this afternoon. “I’ve honestly heard similar rumors about every other company in the space, so I don’t put too much credence in what people are saying these days.” A Google spokesman declined to comment on “rumor and speculation.”

Whether or not it makes sense for Google to buy Invite or any other DSP depends on whom you talk to. Some people think a DSP is a natural complement to Google’s AdX unit, since it makes it easier for big ad holding companies to funnel money into the exchange.

But others argue that since the point of a DSP is to let buyers work with multiple exchanges–like the one that Yahoo (YHOO) operates and the one Microsoft (MSFT) is testing–it makes no sense for buyers to use a tool owned by the industry’s biggest player. If anything, it makes much more sense for an ad buyer like Publicis’s Vivaki unit, which uses both Invite and Google’s exchange, to snap up Invite, they argue.

Turner and his co-founders started Invite Media when they were still undergraduates at the University of Pennsylvania; the company has offices in Philadelphia and New York City. Investors include Comcast’s (CMCSA) venture arm and First Round Capital.

Invite had previously considered selling to Omniture last summer, but that deal went away after Adobe (ADBE) purchased the analytics company. I’m told the proposed price for that deal was $17 million.

Meanwhile, Google shows zero signs of slowing down its M&A binge, which began last summer. Last week, the company announced two deals in addition to AdMob: The search giant said it intended to buy Global IP Solutions for $68 million and announced that it had purchased Simplify Media a few months ago.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik