Slowing Media M&A Activity, But Digital Media a Bright Spot

 |  Includes: GOOG, MSFT
by: Research Recap

The average value of merger and acquisition activity in the US marketing, advertising and digital media industries declined in the first half of this year. While the number of transactions was up 21% compared to the first six months of 2007, dollar volume was down 26% , according to investment bankers Petsky Prunier.

This reflected a soft economy, as well as two significantly large deals during 1H07 - aQuantive/Microsoft (NASDAQ:MSFT) and DoubleClick/Google (NASDAQ:GOOG). Petsky Prunier tracked $19.7 billion in estimated transaction value and a total of 398 deals.

The Digital Media segment generated the most value, with 78 transactions totaling $6.3 billion.

Petsky Prunier says digital video is the hottest new online format today for effectively reaching and engaging customers. “It has incorporated itself so well into the online fabric that consumers increasingly expect to find video capability at the sites they visit.”

Petsky Prunier’s mid-year report also focusses on the growth in Out of Home Media, where video is making inroads.

Digital OOH has grown at a rate of 40 to 50 percent a year over the past five years, and I would say, for the foreseeable future, it’s going to continue to grow at least at 30 percent. - Michael Collette, president & CEO, Heatlhy Advice Networks