IMSG Buys Zap Medya

There's a new acquisiton in the Turkish internet industry - IMSG has acquired Zap Medya for approximately $13m (probably after an earnout).  The announcement also discloses that Zap had 2006 revenues of $12m and pre-tax earnings of $2m.

Zap is an interesting company that it has somewhat cornered the dysfunctional online advertising industry.  I presume that the bulk of the $12m revenues is actually media billings of its customers and, if true, it points to the enormous cuts the middlemen have in the Turkish online advertising market, given the very high net margin indicated by the earnings figure.  One has to wonder how sustainable the current model is, given that the media buying agencies, which previously have outsourced their online work to Zap, have started launching their own online companies and departments.

The acquisition is good news for Turkish internet sector, as more and more international players are taking notice of the opportunities here.  Congratulations to the Zap team.

PS. I am going through a much slower blogging period, largely due to a new baby. :)

UPDATE: Bulent Boytorun, Zap's CEO sent me a message with some corrections, as well as some clarifications on the transaction and Zap's business.  Here are the hightlights:

...the figures that were disclosed were not properly announced. The 2 m is a figure forecast for 2007 at an expected turnover of around 20 m USD, and Zap's sole income is not the media billings [but also from our creative and content management services].
...
Not a majority of our profits are generated from our creative & content management services, but it is still quite sizable.
...
It is the usual practice to have about 10 % media commission on online media billings throughout the world, since the budgets are much smaller than those on TV or newspapers and the work involved is quite extensive. However, especially big networks add to this commission their adserving costs -which may be between 5 to 50 cents per CPM- as well as additional creative and analysis charges or even extra charges for strategic planning.

Here at Zap, we provide all these services free of charge (including at many cases the whole creative work if it is in connection with a sizable campaign) and all is included in the commission we charge.

Comments

[berke]

hakkaten mi??? helal olsun zap a.
Umarim sende iyisindir. ben bir ihtimal www.thelobbyconference.com a gitmek istiyorum. bu eventten haberin vardir sanirim. haber veriyim dedim.
:)

sevgiler..

[Ekim Nazım Kaya]

Thank you for sharing Boytorun's comments, and congrats on the baby!

[Empedocles]

Hi
My After reading your piece on IMSG Buys ZAP MEDYA I would like to ask your opinion about the growth in the online Turkish Internet sector over the next two years.
The reason for my enquiry is that in 1999 I registered a number of generic Turkish and Italian generic domains related to the Insurance and automotive sectors with a view to the advertising markets and the possible option of using the generic terms to create low cost entry as a main approach for developing an insurance aggregator.
I do not speak Turkish and would therefore need help and advice when dealing with any future options.
I have listed the Turkish registrations below and would grateful for your comments either through your blog or direct to me if this is of interest to you.

otosigortasi.com
otomobilsigortasi.com
evsigortasi.com
ev-sigortasi.com
tatilsigortasi.com
tatil-sigortasi.com
arabasigortasi.com
arabakiralama.com
arabafiyatlari.com
araba-fiyatlari.com
yeniaraba.com
yeniarabalar.com
fordaraba.com
fordarabalar.com
hondaaraba.com
hondaarabalar.com
bmwaraba.com
bmwarabalar.com
fiataraba.com
fiatarabalar.com
renaultaraba.com
renaultarabalar.com
peugeotaraba.com
peugeotarabalar.com
dovizkurlari.com
doviz-kurlari.com
dergileri.com
modadergisi.com
modadergileri.com
kayitlar.com