Potential Scoop- Another Adware Network Being Bought?
In this installment my information net comes up with some real interesting intel from the rumor mill. So interesting it will send adware and business analysts into seizures of their own. (I have always been known to spread the fun.) Because it is still in the rumor mill, and I don’t have a 100% confirmation I will not reveal the company contemplating the purchase, but will do so at a later date if it is confirmed. For now we will refer to them as Company X.
The rumor on the street is a leading company (Company X) in the lead generation marketing business, is going to or has made an acquisition of their own and I can’t think of a worse candidate.
Company X was started in January 2002 and they claim clients like Discover Financial, JP Morgan Chase, and Columbia House on their roster. They do this through a number of distribution channels including web, search, and email and they do it all using the pay-for-performance pricing model. Of even greater interest is that they secured $20 million in Series A funding from a large venture capital firm last year. That is quite a bit of money and apparently, they aren’t sitting on it either.
The buzz circling among insiders is pointing to a potential acquisition of Carribean-based, Avenue Media. Does the name ring a bell? It will ring some bells if you recall a recently settled lawsuit between Avenue Media and Direct Revenue. Avenue Media sued Direct Revenue claiming Direct Revenue was using competing software to detect and delete Avenue Media’s Internet Optimizer program from its customers’ computers. I believe this was referred to in the media as “Cannibals Feasting on Each Other” or something alone those lines. Delicious imagery. When Direct Revenue is cleaning you off people’s computers you really should be required to make a saving throw versus quality.
So assuming this acquisition rumor is true- what is all the controversy you ask. It is again in the dubious distribution. Many analysts have noted, myself included, that Avenue Media (or their affiliates- who knows?) use pornography and dialer software to get their software on people’s machines and in some cases their software is not installed with adequate notice.
Thus it would seem that another ad network is considering buying another ‘adware network’ although this time the adware label is really stretching things a bit.
Are there more acquisitions like this on the way?
Does quality and disclosure really matter?
Do VC firms truly understand what their investments are buying?
Is anyone paying attention?
