AOL eying Third Screen Media

March 1, 2007: America Online (AOL) of Time Warner Incorporated is holding talks to buy mobile phone advertising start-up Third Screen Media.

The Wall Street Journal reported on Tuesday that the deal for the company, which posts small advertisements on mobile phone screens, is likely to be in the range of $80 million. The talks could still fall through, the paper said.

In 2006, Microsoft Corporation’s MSN unit was close to buying Third Screen, but the deal fell apart, according to the paper.

At that time, the company had said it was looking for additional funding to expand its mobile advertising business rather than trying to sell the company.

AOL and Third Screen have been negotiating since early 2007 and discussions are fairly advanced, The Wall Street Journal said.

If a deal is struck, Third Screen is likely to become part of AOL’s Advertising.com unit, which helps broker advertisements on the Internet.

Wireless providers, advertisers and media companies are all eyeing wireless devices as potential vehicles for advertising as more and more mobile phones have high-quality color screens, video-players and web browsers.

Third Screen hopes to carve out a niche in this market by selling software that specialises in placing advertisements on mobile video clips, websites and video-game players.