Lycos looks to online video advertising in quest for new life as it sheds old patents

What a long, strange trip it's been for Lycos: The Internet's first really big search engine has remade itself as a digital media company. This week the company released its fiscal fourth-quarter and full-year 2015 results, declaring that it plans to become "one of the larger video advertising players" worldwide, with a focus on mobile advertising.

As part of Lycos' advertising division it offers demand-side platform (DSP) programmatic working with publishers like MediaMath, Gannett Broadcasting and others.

Lycos said that annual revenues for its digital segment grew by 21.58 percent, part of an overall year-over-year revenue growth of 15.71 percent. The company brought in $320.03 million in revenues in fiscal 2015.  

Acquired in 2010 by Hyderabad, India-based Ybrant Digital (which in turn was gobbled up by LGS Global in 2012) for $36 million--a precipitous drop from its 2000 sale to Telefonica-owned Terra for $12.5 billion--Lycos has become the face of the larger company and its fount of hope.

While the growth of online video advertising, and programmatic in general, hold the promise of new profits for Lycos, it hasn't been smooth sailing.

Last week the company, which still has offices in Boston, put up for sale a huge portion of its patents around online ads, online games and search engines. Some may see it as a spring cleaning of sorts--Lycos is building a third division around consumer products that fall within the realm of the emerging Internet of Things (IoT) concept, and likely needs the quick cash. And those old patents could still have some steam behind them.

Still, other technology companies may have a keen interest in owning those patents. A PatentVue analysis found that Lycos' innovations still get plenty of forward citations, with Google and Microsoft citing Lycos patents most often. "A higher forward citation count for a patent / patent portfolio may indicate at a high level how fundamental those patents are to their industry. In terms of potential acquirers, the Lycos patents may be of interest to one of the above listed companies which appear to have related patented technology," the analysis concluded.

Brad Cohen, president of the company, said in a release that it was selling or licensing its patents in hopes it would "foster a collaborative and mutually beneficial relationship with partners and industries."

But not all uses will be beneficial. In 2012, for example, a company called Vringo that owned two of Lycos' former patents successfully sued Google in federal court for patent infringement. Google was able to overturn the ruling on appeal, Beta Boston reported, but the Supreme Court may review it.

In the meantime, Lycos is wading into fresh waters with programmatic advertising and IoT products. Its display ads segment already boasts several blue-chip clients like Viacom, Samsung, Unilever and P&G, giving it one foot in the online video ad game so far. But it faces stiff competition from some very familiar faces, like Yahoo and AOL--both with their own large-scale video advertising strategies coming into play.

For more:
- see the earnings release
- Beta Boston has this story
- PatentVue has this analysis

Related Articles:
Yahoo's Utzschneider on the potential of cross-platform advertising
Verizon snaps up AOL for $4.4B, locking in mobile video, advertising tech
AOL revenues climb 7% to $625.1M on strength of video advertising, programmatic strategy

Updated June 25 to clarify Lycos' advertising platform relationships.

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