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Has mobile ad network Quattro Wireless been acquired?

Sources say that mobile ad network Quattro Wireless, one of the top five in its category, has been acquired. If true, who could the acquirer be?

The same sources expect that an announcement will be made around the Consumer Electronics Association?s CES show Jan. 7-10. If confirmed, this transaction once again changes the face of mobile advertising, coming as it is only two months after Google announced plans to buy mobile ad network AdMob for $750 million (see story).

?One thing I?m expecting to see in 2010 is more mergers-and-acquisitions activity in the mobile world,? said Michael Boland, San Francisco-based senior analyst and program director at BIA/Kelsey. ?That will come with an improving economy and greater interest for companies in the mobile space to combine resources and offerings to advertisers.

?Another general trend is that mobile advertising will move downmarket to small and medium-sized businesses and mid-market segments,? he said. ?So far it has mostly been large national advertisers and agencies, but just like we saw online over the last decade, this will shift.

?The key point is that in order for this to work, mobile marketing has to be more enticing for advertisers.?

Calls to Quattro were not returned yesterday. (It is not this publication's practice to publish articles based on unsubstantiated rumors or nameless sources, but the whispering around Quattro's supposed acquisition merited at least a mention, especially given the size and importance of the company.) 

Google?s acquisition of AdMob was an example of mobile advertising increasing reach and thus increasing appeal for brands and agencies. The acquisition of Quattro would be another example.

Millennial Media, Mojiva and Jumptap are the leading independent mobile ad networks that could also be potential targets for M&A.

?The capability to serve and distribute display advertising will be an extra enticement for its advertisers, especially existing advertisers, which Google hopes to move into mobile marketing,? Mr. Boland said.

?This general combining of resources will be behind much of the mergers-and-acquisitions activity we will see unfold over the coming months,? he said.

?Expect others planting various stakes in mobile to do [something] similar, including Microsoft.?

Quattro?s clients include Procter & Gamble Co., Ford Motor Co., Disney, Netflix, Viacom, BP, Kmart, SAP, Microsoft, Papa John?s, Visa and TigerDirect. These marketers use Quattro?s Q Elevation platform to run mobile ad campaigns.

The Waltham, MA-based company?s publisher network includes Time Inc., Gawker, NFL, NHL, CBS Interactive, Slacker, Weatherbug, Imeem, Viigo, Univision, Hachette, Edmunds, uLocate and Sportacular.

Who could it be?
While Microsoft would be a logical candidate to acquire a mobile ad network, one name popping up in scuttlebutt now is Yahoo, although it is hard to officially substantiate.

Another source claims it is a more traditional company that has acquired Quattro. There is also speculation that it could be Apple.

The acquisition of a mobile ad network such as Quattro would give Yahoo instant clout in the mobile advertising space, something it has yearned for in the last couple of years.

Yahoo already has a strong mobile portal and applications, but much work is required to increase awareness among consumers.

?In some ways, the Google-AdMob acquisition made this kind of move, this kind of consolidation, inevitable,? said Noah Elkin, senior analyst at eMarketer, New York. ?If Yahoo wants to stay competitive in the mobile space, where they already have a fairly established presence, they need to make a move like this to stay at a comparable level with Google.

?There are two forces at work here, the competitive landscape between Google, Yahoo and, to a lesser extent, Microsoft, and the breadth of ad networks that are available to advertisers and publishers today,? he said. ?They all do things a little bit differently, so it?s not like by buying Quattro they would be getting an exact copy of AdMob, but there are quite a number of ad networks out there, so it makes some degree of consolidation inevitable.

?Yahoo-Quattro would be comparable certainly to Google-AdMob?Quattro is smaller but is positioned as a premium ad network, which reveals what Yahoo?s strategy might be: fill an exclusive niche in the market rather than going head-to-head with Google-AdMob by having a slightly different type off offering.?

Whether it is Yahoo, Microsoft or another unexpected player that acquires Quattro, so much M&A in the mobile ad networks space indicates that mobile advertising is poised to take its rightful place in the marketing mix.

?One acquisition like this is one thing, but after two you start to see a little bit of a trend,? Mr. Elkin said. ?This confirms the point that Mobile Marketer and many in the industry have been sounding over the second half of this year that mobile in 2010 will become a much more mainstream platform for advertising and marketing.

?Being part of a larger ad network could address the scale issues that many advertisers and publishers have had about mobile,? he said. ?If Yahoo were to acquire Quattro, it would put a fair amount of pressure on Microsoft to make a similar move.

?Microsoft is serious about mobile, so it would put pressure on them to make a similar acquisition or bolster what they already have, and the usual suspects would be probably be in play at this point.?