Singtel buys digital ads firm Amobee for US$321M, moves away from old carrier business

SingTel, Southeast Asia’s largest phone company, has announced this week that it has agreed to purchase US-based digital ads company Amobee for US$321M. Singtel aims to introduce products from Amobee to its customers within a year.

Amobee’s flagship product is an end-to-end advertising platform for publishers, advertisers, and operators. They’ve recently made a push into Asia, announcing partnerships with advertising companies in Vietnam and Indonesia.

The move is seen as SingTel’s continuation of its strategy to diversify away from the traditional telco business. The company expects to generate growth by expanding its mobile ads business and offering targeted special deals to customers.

Smartphones have become increasingly ubiquitous in developed and emerging market, putting a strain on a cash cow of many carriers — the long-serving SMS. Research firm Ovum estimates that free messanging apps like Whatsapp are costing carriers a combined US$14B last year. This trend is expected to continue.

Now, SingTel hopes that smartphones will be a driver of the company’s future growth in the future. It is charging users for data and subsidizing phone prices in exchange for tying down consumers to the carrier’s subscription plans for two years or more.

The company has also set up the SingTel Innov8 venture capital fund as a means of transforming itself from a traditional carrier to a multimedia and infotech service provider.

Some of Innov8′s past activities have included a Series A investment in daily deals platform company Dealised, as well as the funding of other firms like mobile social communications company Bubble Motion, in-app mobile payment company Stream Media, and mobile marketing firm 2359 Media.

They are also involved in some joint ventures with the Singapore startup community, most notably the SingTel Startup Weekend Singapore and the JFDI-Innov8 Bootcamp.

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