Pandora is making further moves to advance its audio ad tech stack, acquiring digital audio advertising technology firm AdsWizz for $145 million.
AdsWizz provides software for both advertisers and publishers, offering support for dynamic ad insertion, programmatic placement, activity-based targeting and other ad tech staples. Additionally, the firm invests significantly in research and development, creating new audio formats like “ShakeMe,” an ad product that would allow listeners to interact with ads by shaking their phones.
“Since I joined Pandora six months ago, I have highlighted ad tech as a key area of investment for us,” said Roger Lynch, CEO of Pandora, in a statement. “Today we took an important step to advance that priority and accelerate our product roadmap.”
Under Pandora’s ownership, AdsWizz will remain its own company and keep its executive team, allowing it to continue its business with several of Pandora’s rival companies like iHeartRadio and Spotify. For its part, Lynch’s company plans to invest mostly in new audio ad technology development, which it claims will be made available to “all constituents.”
“Our focus has always been digital audio,” said Alexis van de Wyer, AdsWizz CEO. “That will not change. What will change is our ability to grow even faster, to develop technology more rapidly.”
Pandora has of late been expanding its premium subscription options, launching a web app similar to Spotify’s service just last month, but it still relies primarily on advertisers to support its business. According to Pandora’s Q4 earnings call, subscription revenue totaled only $97.7 million, as opposed to its $297.7 million in income from ads.
In his statement, Lynch declared his hopes that the acquisition will create “the largest digital audio advertising ecosystem,” but was quick to reassure that Pandora would not be the only company with a share in the spoils.
Now that fees paid to AdsWizz may end up in Pandora’s coffers, it remains to be seen if rival music services may be willing to take part in Lynch and van de Wyer’s vision of the audio future.
