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M&A optimism bubbles up in media industry

Feb 1, 2024
Paramount Global CEO Bob Bakish and IAB CEO David Cohen sitting on chairs on a stage with IAB AM '24 It Starts Here in the background

Paramount Global CEO Bob Bakish and IAB CEO David Cohen. Photo: Kerry Flynn/Axios

Cautious optimism about dealmaking flowed through the presentations and conversations at IAB's Annual Leadership Meeting this past week.

Why it matters: After a year when economic and industry challenges hit from both sides, media executives and investors are kicking off 2024 with an eagerness to explore deals.

What they're saying: "Our pipeline is full," Shamrock Capital partner Laura Held said during an IAB panel on the state of dealmaking. "The big question [is] ... the activity might be up, but what actually gets done?"

  • "I'm optimistic. The bar is low compared to 2023," Providence Equity Partners managing director Lucy Dobrin said on the same panel.
  • "I think the ice is melting, but it's melting really slowly," Spotify vice president Sheila Spence added. "A lot of companies like us have this amazing, like, super-fit feeling right now ... but that means the bar is really high."

Meanwhile, during an onstage interview with Paramount Global CEO Bob Bakish, IAB CEO David Cohen asked about sale chatter. Bakish acknowledged the reports but expressed caution.

  • "99% of deals don't happen," Bakish said. "That's just the way it is. Get all the stars to align; it's not that easy."
  • "There's certainly a case for consolidation in media," he added. "But that's different than saying something's certainly gonna happen."

The intrigue: Potential buying opportunities surround software businesses that support data collection and collaboration, given the deprecation of internet-tracking cookies.

  • Snowflake acquired data "clean room" startup Samooha in December. And just two weeks ago, LiveRamp announced its acquisition of Habu.
  • LiveRamp CEO Scott Howe and Habu CEO Matt Kilmartin both attended the IAB conference, taking meetings together to discuss their merger with existing and potential clients.
  • "Our dance card is full," Howe quipped in a conversation with Axios.

What's next: Enthusiasm is bubbling around generative AI.

  • Howe says LiveRamp is on a "giant, fact-finding, collaboration spree" about generative AI. "There is so much hype about Gen AI, but it's not hype. It's real. Maybe not as companies but as applications."
  • Spotify's Spence said on the dealmaking panel that the "build, buy, partner" framework is "critical around AI." She noted that Spotify acquired AI voice platform Sonantic with the goal of owning the technology but is also seeking generative AI partners.
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