Microsoft to acquire Xandr from AT&T

Microsoft bought AT&T Inc.'s advertising division, Xandr, and this was revealed on Tuesday, Dec. 21. The telecommunication company headquartered in Dallas, Texas, is partly moving away from the business that seems to have become expensive to operate and maintain.

The tech company further said that the deal builds on a decade-long relationship between Xandr and Microsoft in the industry. AT&T's ad unit was established in 2018 through the purchase of ad exchange and a TV ad tech firm to make use of data gathered from TV services, the internet, and phone to target the consumers.

According to Reuters, AT&T invested billions to set up a firm that houses a media company, an advertising platform, and a satellite TV provider. However, the plan was met with criticisms from investors as the company also struggled to lessen debt.

Microsoft is generating a large part of its revenue by licensing its Office and Windows software. It also operates several other lucrative ventures such as advertising-supported businesses, including its MSN News, LinkedIn, and Bing search engine.

"Microsoft can accelerate the delivery of its digital advertising and retail media solutions, shaping tomorrow's digital ad marketplace into one that respects consumer privacy preferences, understands publishers' relationships with consumers and helps advertisers meet their goals," Microsoft president of web experiences, Mikhail Parakhin, said in a statement.

In any case, Microsoft will be acquiring AT&T's Xandr unit to step up its delivery of digital advertising as well as retail media solutions. Then again, it was clarified that the advertising sales business supporting DirecTV is not included in the deal.

The financial details of the acquisition were not revealed to the public and the transaction is still subject to regulatory review. AT&T's shares also increased by around 1.4% in early trading after the news came out.

Finally, on Dec. 21, Microsoft stated in a blog post, "Today, Microsoft is announcing that we have entered an agreement to acquire Xandr from AT&T. Xandr provides a data-enabled technology platform with tools that help power a diverse ecosystem connecting marketers and media owners through first-party, data-led advertising solutions across its network."