Twitter has announced the sale of its advertising network MoPub, to AppLovin, a group of monetization services for application creators. The deal is worth $ 1.05 billion. The social network particularly wants to focus on its own advertisements.
This transaction should be finalized ” in the coming months “. She could allow Twitter ” improve its capacity to invest in certain key products », Explains its CEO, Jack Dorsey.
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A strategic acquisition for AppLovin
« We are excited about the opportunity to develop the AppLovin platform and further improve our publisher monetization tools through this strategic transaction. ”, Said Adam Foroughi, CEO of AppLovin, in a statement.
Currently, 45,000 applications use MoPub, bringing the number of users who can be reached by advertising to 1.5 billion. Huge potential, which explains why AppLovin wants to acquire MoPub. Adam Foroughi’s company enables developers to market, and monetize, their applications, through its advertising and marketing platforms.
MoPub was acquired by Twitter in 2013 for $ 350 million. This is a monetization service for application publishers, allowing them to serve advertising. In 2020, MoPub generated nearly $ 188 million in revenue. The sale of this service may therefore seem surprising, but Twitter has considered selling it in the past. Particularly in 2016, when the group’s growth turned out to be particularly disappointing.
Today we are announcing that @MoPub is being acquired by @AppLovin. It’s a big moment in the mobile app ecosystem, and we believe AppLovin is well positioned to grow & evolve MoPub’s network of customers in the rapidly changing in-app industry.
– MoPub (@mopub) October 6, 2021
Twitter wants to double its annual turnover by 2023
Since 2020, Twitter has sought by all means to diversify its sources of income, with the objective of doubling its annual turnover by 2023. Ned Segal, chief financial officer of Twitter, recalls that the goal is to go from 3 , $ 7 billion in 2020, to $ 7.5 billion in 2023. Finally, this sale should also offset the heavy expenditure of $ 809.5 million, following an agreement with shareholders at the end of September. An amicable agreement coming from the fact that some had taken legal action, and accused the leaders of a false communication on the results of the group in 2015.
However, there is probably another reason for the sale, which Twitter is careful not to mention. A few months ago, Apple launched the Tracking Transparency App. This feature forces applications to ” request the user’s permission to access data related to the application in order to track him or the device “. It therefore weakens the economic model of applications, which is essentially based on advertisements. A model which is the business of MoPub. Faced with a trend that is the fight against targeted advertising, Twitter may have seen fit to let go of MoPub.
Either way, the company is not giving up on advertising. On the contrary, it wants to develop it, but on its own services. Another way to increase your income. It is in this perspective of diversification that Twitter recently announced new services, such as a premium subscription called Twitter Blue. Several acquisitions and agreements were also made, such as the acquisition of Scroll, or the agreement with the podcast application Breaker. It remains to be seen how Twitter will use this money to achieve its financial goals.