AT&T could be interested in selling off Xandr, its advanced advertising business, according to a new report from the Wall Street Journal.
The report suggests that AT&T is still in the early stages of a potential sale but warned that the company likely wouldn’t get more than the $1.6 billion it paid for AppNexus, the ad tech firm it acquired to be a key component of Xandr.
Rumors about AT&T selling Xandr come along not long after AT&T combined its ad business with WarnerMedia. AT&T said the divisions would combine all go-to-market and commercial efforts and that the combination should accelerate innovation for new advertising formats for HBO Max in 2021.
HBO Max launched on May 27 priced at $14.99 per month. WarnerMedia said that by 2021, the company will add an ad-supported service to HBO Max and, further down the road, the service will be home to live and interactive content along with special events.
AT&T CEO John Stankey, while last year pitching HBO Max to MVPD partners, pointed toward all the user data that will be generated through the HBO Max platform. He said that data would be integrated with Xandr, where it could be anonymized, aggregated and visualized on a nationwide basis. He said that will help with monetization once HBO Max’s AVOD offerings begin rolling out.
However, the report said the Xandr hasn’t met the growth expectations set by AT&T, that it’s encountered technical issues and that it has had a hard time acquiring video advertising inventory. Streaming video publishers didn’t want to sell ad inventory through Xandr since AT&T’s streaming services are some of their primary competition, according to the report.
AT&T’s reported efforts to offload Xandr follow similar reports suggesting that the company is looking to part ways with other assets as it looks to pay down some of its debt.
Late last week, the Wall Street Journal reported that AT&T is once again looking into a deal to offload DirecTV, which lost another 846,000 subscribers in the second quarter, according to Leichtman Research Group. Earlier this month, The Information reported that AT&T is looking to sell Crunchyroll, its streaming video service focused on anime, to Sony for $1.5 billion.