Real Media and Japan’s Dentsu Inc have announced an expansion of their search engine marketing (SEM) partnership through a new holding company, which would be called Dentsu 24/7 Search Holdings. The new company will establish new operations within other strategically important advertising markets throughout the Asia Pacific region, including China, India, Korea, Thailand, and Taiwan. These new operating units will be the preferred SEM service providers for Dentsu and 24/7 Real Media affiliates within each region.
Under the terms of the agreement, Dentsu and 24/7 Real Media will each provide initial capital of $5 million, which will be used to fund operations in the identified expansion countries. 24/7 Real Media will license its industry-leading Decide DNA technology, again rated highest among SEM platforms by Jupiter Research to each operating subsidiary. Initial management of the new venture will be fully supported by K.K. 24-7 Search, the existing Tokyo-based joint venture of Dentsu and 24/7 Real Media.
“We are very pleased to expand our strong relationship with 24/7 Real Media,” said Ryuichi Mori, Director of Dentsu, adding, “Over the past 14 months, 24/7 Real Media has proven to be a trusted, reliable partner, and the decide DNA technology has proven itself to be the right solution for the Asia-Pacific region.”
According to PricewaterhouseCoopers, nearly $1.0 billion would be spent in 2006 through online advertising in the five countries initially identified for expansion by Dentsu and 24/7 Real Media. While Korea and China currently benefit from the majority of this expenditure, less mature markets such as India are expected to rapidly develop as broadband access continues to proliferate. In the aggregate, China, India, Korea, Thailand and Taiwan are forecast to realize compound annual growth of greater than 20 per cent over the next four years as online spend more than doubles to $2.0 billion in 2010.
“The establishment of this new joint venture is a testament to the strength of the relationship between Dentsu and 24/7 Real Media,” said Jae Woo Chung, President of 24/7 Real Media Asia. He further said, “We view India as a very important future advertising market. Dentsu already has several affiliate offices in the country like Dentsu Communications (Bangalore), Dentsu Marcom (New Delhi) and Dentsu Creative Impact (New Delhi) in India.”