The following piece is a follow-up on my previous note April 3rd.

Most recently, industry insiders have been abuzz speculating who would acquire Sizmek’s remaining assets including its ad server and dynamic creative optimization platform. Of these, you probably heard rumors that the front runner was a company starting with the letter ‘A’.  By now, the secret is out that it’s not Adform – which is perhaps less of a surprise to some as we’ve always been very clear that we prefer to build our tech from the ground up as this delivers better results.

Recently Amazon confirmed what many of us were expecting, it had acquired Sizmek’s remaining assets. We’re glad to see Sizmek’s core assets find a new home and hope that the acquisition will safeguard many of the jobs that had been put at risk following the administration news. We’ve also long considered Sizmek’s ad serving technology to be a strong asset and one that had historically helped maintain a healthy independent ecosystem. Amazon’s decision to pick up Sizmek also further goes to show that ad serving is still very much a strategic asset and continues to hold a fundamental place in the market.

Theoretically, this puts Amazon in a much better position to compete with Google for advertiser budgets. A trend which we welcome as supporters of a fair and thriving ecosystem, in which diversity and competition is essential.  But, there are still some questions that remain to be answered. 

The biggest of which is how Amazon plans to integrate Sizmek into its platform, or whether it will keep it as a standalone product. Based on what we know so far, the speed of the acquisition, and historical examples, it’s very likely that Amazon will use the former Sizmek assets to bolster its own stack. In such cases the new organization usually enjoys a brief period of autonomy before attempts at integration begin ending with the eventual shutdown of the original company assets within 12-36 months. With Amazon’s strong incentives to continue to focus on keeping customers within its own walled garden environment, attempts at a rapid integration into their wider advertising services seems inevitable.

This will ultimately limit choice for advertisers and may not be well received by agencies and brands. Particularly for those that have a vested concern about enriching Amazon’s sales data to their own detriment. For others that were drawn to Sizmek because of their media agnostic nature, Amazon’s existing portfolio of companies and ongoing aggressive acquisitions and constant expansion into new industries is a source of significant concern. Prime examples of this are Amazon’s recently announced forays into travel/hospitality and cellular/mobile. 

One of Sizmek’s biggest selling points, and something we also are passionately about, is the need for an independent, third party ad server. Although Amazon will be empowered to face Google, limiting the ecosystem to one walled garden vs. another will only stifle innovation, harm transparency and further impact creativity.

Additionally, when larger tech companies are in the acquisition seat, the acquired technology often suffers, falling victim to an unspoken trend of ‘buy now, worry about the plan to integrate later’.  And we have seen the dire consequences of this in the past with Atlas. Acquired by Microsoft in 2007, it was later sold at a loss to Facebook, who stripped primary talent and functionality, and closed it down three years after buying it. This highlights the challenges faced with integrating technologies. Just as the ease with which Sizmek’s partially integrated DSP and DMP capabilities were rapidly spun back off and sold piecemeal despite over a year of integration efforts. 

For brands unwilling to roll the dice, or which have previously made the strategic decision to focus on media-agnostic technology, we remain well positioned to support.

Adform remains the industry’s premier independent ad server at scale. More than that, we have the industry’s only truly integrated advertising platform that has the modularity and individual flexibility to choose the ideal product configuration. We have a long history of creative excellence and proven track record as DCO experts re-affirmed by our recently launched DCO Pro offering. 

We’re ready, scaled, and have the footprint to easily transition clients while taking up the slack and reducing disruption.

Gustav Mellentin, CEO