T-Mobile US to spend $600 million on ad firm Vistar

Essentially, this is a major telecoms operator having another crack at the advertising space despite the fact that many of its peers have failed before.

This time though, T-Mobile insists that the time is right to capitalise on the promise of the market – in this case, the digital-out-of-home (DOOH) space in particular – and put its wealth of customer data to good use.

Under the terms of the deal, T-Mobile will subsume Vistar Media into its T-Mobile Advertising Solutions business. Vistar will bring its marketplace and technology solutions for buying, selling and managing media campaigns, which currently run across 1.1 million digital screens provided by close to 370 media owners, serving 3,000 brand partner advertisers.

To put it simply, Vistar has an advertising technology platform and the scale to go with it, while T-Mobile brings its customer knowledge and data to the table.

"DOOH represents a unique, useful, and dynamic channel for advertising in an increasingly digital world," T-Mobile said. To back up its point it cited a forecast from eMarketer that this year DOOH ad spending in the US will account for more than a third of the close to $10 billion spent on overall OOH advertising.

"The timing is perfect for this transformation as digital screens still represent a small percentage of the overall OOH advertising market and are becoming more accessible," T-Mobile said.

"We see a tremendous opportunity to provide more relevant and personalized advertising," said JP Colaco, T-Mobile's Chief T-Ads Officer. "Combining T-Mobile’s customer-centric approach and its expertise as one of the nations most scaled marketers, with Vistar’s leading out-of-home technology means advertisers can easily place their ads where they know their audience will be, improving every step of the customer journey."

The telco talks a good game. But telecoms players have long looked sideways to the advertising space and the chance to use their data to provide more personalised ads to consumers, keeping the latter happy and making some money in the process. And to date these endeavours have not gone particularly well.

Those of us in the UK doubtless remember Weve, an advertising and payments joint venture between O2, EE and Vodafone. While the payments aspect of the business quickly fell by the wayside, the advertising side was full of promise due to its potential for targeted ads. O2 bought out its partners in 2015, but closed the ad business a year later, stating it would use its data in-house only.

Meanwhile, back across the pond AT&T had a run at advertising through Xandr as part of its broader content push, and we all know how that ended. Xandr itself was sold to Microsoft three years ago.

This T-Mobile deal is quite different from those ill-fated examples of telco advertising, and others, but it still comes with warning flags.

History has shown that how obvious the crossover from telco data to advertising might seem, be that old school mobile advertising or the up-and-coming DOOH market, it is not an easy nut to crack.