Telefónica targets mobile ad market with dedicated exchange platform

Telefónica launched a mobile advertising exchange platform it said is the first to be owned and backed by a mobile operator, as it vies for a slice of a market that generated an estimated 13 per cent of all internet ad spending in 2013.

Simon Birkenhead, CEO Axonix

Simon Birkenhead is leaving Telefónica to become CEO of Axonix

The operator has established Axonix along with companies affiliated with investment company Blackstone's GSO Capital Partners division to offer mobile publishers and advertisers a marketplace to buy and sell mobile advertising. Axonix will initially operate a self-service ad exchange service in Europe, U.S. and Latin America, and has already signed up its first 100 partners.

Stephen Shurrock, CEO of digital service and innovation at Telefónica, said the company is "proud to be the first telecoms company in the world to own and power a mobile ad exchange platform," and that the company expects Axonix to "become one of the leading global technology platforms in the mobile programmatic advertising industry."

Telefónica's current director of global advertising and sales, Simon Birkenhead, will leave the operator to become Axonix's first CEO. The new company will be headquartered in London and will operate independently of Telefónica and Blackstone GSO, while leveraging the parent companies' financial credibility and advertising experience.

"Our immediate priority now is to scale the business quickly by attracting the best talent in the industry, right from the heart of London, and partner with leading brands, agencies, networks and publishers to make highly targeted, relevant and impactful mobile advertising a reality across the globe," Shurrock said.

Research firm Zenith Optimedia recently predicted the value of the mobile advertising market will grow by an average of 50 per cent between 2013 and 2016 and become the world's fourth largest medium at that point. Mobile advertising expenditure hit $13.4 billion (€9.6 billion) in 2013, equivalent to 12.9 per cent of all internet expenditure, and 2.7 per cent of advertising across all media, the company said.

Telefónica's move comes less than two months after it announced it would shut its specialist Digital division, which was established to generate new revenue streams in alternative markets, and bring the unit's work in house under the command of Eduardo Navarro, who was appointed chief commercial digital officer.

Shurrock says the launch of Axonix demonstrates Telefónica's "unwavering commitment to putting digital services front and centre as we transform into a digital telco."

The operator last week unveiled Yaap, the brand name for what is being hailed as a landmark mobile money joint venture with Spanish banks CaixaBank and Banco Santander.

For more:
- see Telefónica's announcement
- see Zenith Optimedia's figures

Related Articles:
Telefónica eliminates Digital brand, aims for €1.5B in cost savings
Telefonica connects Tesla cars in Europe
Telefonica unveils Yaap as brand name for Spanish mobile payments venture
Telefónica's new digital chief issues rallying call to EC on digital economy
Telefónica Digital CEO: M2M is our fastest growing business