updated 04:23 pm EDT, Mon July 21, 2014
Deal rumored to be worth at least $300 million, could rapidly grow Yahoo's mobile business
Yahoo could be looking for aggressive growth in its mobile platforms, as reports from Recode and TechCrunch indicate that the search company is acquiring mobile analytic and advertising startup Flurry. While official news of the deal has yet to be announced, sources say that the news is expected to come in later today.
Flurry was founded in 2005 in San Francisco with the idea of optimizing mobile experiences "through better apps and more personal ads." The company sits as one of the largest in the area of mobile analytics, claiming that they had a hand in growing the app economy into an industry worth more than $100 billion. Flurry works with businesses to connect with audiences on smartphones and tablets, as well as monetize content.
While the advertising business may not be something that Yahoo necessarily needs to buy, the user base for Flurry is bound to be more appealing. The company claims to do business with more than 170,000 developers, while collected data from 150 billion app sessions each month.
With Flurry's focus on mobile and data are used to drive better advertising and monetization, the company seems like a good fit for Yahoo's business shift under CEO Marissa Mayer. Mayer reiterated that the company was a "mobile first" business during last week's second quarter earnings call.
Acquiring a company like Flurry could lead to large improvements in mobile for Yahoo. As the company currently lags behind other mobile focused companies like Facebook and Google, steps to grab a bigger share and entwine itself in the landscape are becoming more and more important. With the client connections and number of apps tied into Flurry, the deal is just the sort of growth Yahoo needs. Figures from TC put the sale between $300 million and $1 billion, depending on which part of the business is valued.
The advertising portion of Flurry could help Yahoo, as the company is seeing a decrease in display ad revenues. Yahoo says that its looking toward a "unified approach" for advertising, but the recent announcement of year-over-year and consecutive quarterly losses may put the ad business in jeopardy sooner rather than later. Mayer stated during the quarterly call that she wasn't satisfied with the results, but restructuring the company would take more than a few years.
To do that, Mayer has changed the focus of the company and its approach to business. Rather than focusing on building new services, the company has acquired at least 30 companies since 2012. Recent acquisitions such as RayV and Blink show that the search company is looking seriously toward mobile growth. However, the company is still looking internally at solutions, with over 400 employees working exclusively on mobile apps.