Why Twitter sold mobile ad network MoPub to AppLovin for $1.1 billion

Twitter sold its mobile ad network MoPub to AppLovin, at once getting rid of a strategically unimportant asset for $1.1 billion and a property that had caused privacy issues for the company, according to industry experts. On Wednesday, Twitter and AppLovin announced their deal for MoPub, which Twitter bought in 2013 for $350 million. “The sale of MoPub positions us to concentrate more of our efforts on the massive potential for ads on our website and in our apps,” Ned Segal, Twitter’s chief financial officer, said in the announcement. Subscribe to Ad Age now for the latest industry news and analysis. MoPub is a mobile ad network that helps apps and publishers fill their ad inventory through real-time bidding auctions. Twitter bought the company as a sign that it wanted to have a footprint in the wider mobile web advertising ecosystem. However, that ecosystem never quite took off, said Eric Seufert, a mobile analyst who writes the Mobile Dev Memo trade blog. “MoPub just had no strategic value to Twitter,” Seufert said. “They never did anything with it.” As for AppLovin, it will try to build an independent mobile ad network that could thrive where Twitter could not. “AppLovin’s strategy is to wrap its arms around the entirety of mobile advertising impressions on the supply side, pushing all publishers to monetize through its MAX platform,” Seufert said. “The acquisition of MoPub, one of the largest mobile SSPs, supports that goal.” However, there is more to Twitter’s unloading of MoPub than just a sensible deal. The mobile advertising landscape is more complex since Apple started tweaking how data is shared across iPhones. This year, Apple introduced its biggest update to iOS software with an App Tracking Transparency protocol that forced all apps to get permission from users to collect data on their internet activities outside the apps. The changes have affected how ad networks including MoPub, Facebook Audience Network and Google Ad Mob serve developers. MoPub was already causing headaches for Twitter for privacy breaches, according to Zach Edwards, a researcher and privacy advocate at Victory Medium, an independent data auditing startup. “MoPub has been a significant source of sensitive user data to countless advertising companies across the world, and the product continues to be an active source of data that can be used to track,” Edwards said. In 2020, MoPub was named in a data investigation into Grindr, the gay dating app, which used Twitter’s ad network to serve ads. Grindr was ultimately fined about $12 million. In 2020, Twitter paid a $250 million fine to the Federal Trade Commission over its own data practices, where it was alleged the company improperly collected information such as personal email addresses without consent. The case led Twitter to take steps to change how it collects data, in general, on consumers. On Wednesday, Twitter said the MoPub sale was to help the company focus on its own business, which would help it reach revenue goals in the years ahead. “We plan to increase focus on [owned and operated] product development and replenish near term revenue loss,” Segal said, “with the goal of improving time to market to deliver on our previously stated goal of $7.5B or more in 2023.” The acquisition gives AppLovin more power in the app advertising ecosystem, according to Matt Barash, senior VP of business development at Zeotap, a customer data platform. MoPub was competing with AppLovin and Vungle, another ad tech company with a large footprint in mobile apps, Barash said. “With consolidation comes fewer independent mediation options for app developers who have leaned on MoPub monetization for years,” Barash said. “Some big gaming studios will now have to think long and hard about how and if they want to lean on the likes of Vungle and AppLovin, who both own competing titles or build their own homegrown solutions.” Subscribe to Ad Age now for the latest industry news and analysis.

Why Twitter sold mobile ad network MoPub to AppLovin for $1.1 billion

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