AdTech Opportunities for Telecommunications Companies: A Strategic Guide

Telecommunications companies sit on some of the richest consumer datasets outside of Google, Facebook, and Amazon — yet advertising technology has historically been an underexplored revenue stream for the sector. This guide examines the structural opportunities telcos have in AdTech, what the erosion of third-party cookies and mobile IDs means for them specifically, why past acquisitions largely failed, and what a more sustainable path into the space looks like.

Opportunities for Telcos in AdTech

The Data Advantage

Telcos possess consumer data on par with — and in some dimensions rivalling — the datasets held by the largest digital advertising platforms. That data spans:

• Location data via base transceiver stations (BTSs), providing granular, persistent geographic signal
• Online behaviour via network traffic analysis
• Demographic and socio-economic data drawn from contracts and family plans

All of this can be used to construct detailed, accurate audience segments that are genuinely valuable to advertisers. But it comes with significant privacy obligations. Telcos must navigate how to use this data responsibly and legally within a rapidly shifting privacy landscape shaped by regulatory bodies, Apple, Google, and others.

Beyond data, telcos hold a meaningful inventory advantage. They can offer ad space across display, audio, and TV advertising and open that inventory to advertisers through programmatic media-buying channels.

Below are the four most consequential opportunity areas.

Walled Gardens and AdTech Stacks

The scale of Google, Facebook, and Amazon in digital advertising is substantial: according to eMarketer, ad revenues from those three platforms exceeded $200 billion in 2021, growing 38.3% from 2020, accounting for 74% of all digital ad spending.

Telcos are uniquely positioned to offer a credible alternative. By building their own walled gardens and full AdTech stacks, they can give advertisers and agencies a competitive option to the Big Tech incumbents — one grounded in first-party telco data rather than behavioural tracking across the open web.

The competitive landscape will remain intense, but data provides a genuine differentiator for telcos willing to build the infrastructure to activate it.

Scalable Universal IDs

Universal IDs have emerged as one of the primary alternatives to third-party cookies and mobile IDs, and telcos have structural advantages in this area on three dimensions:

1. Scale. Many telcos cover 40% of a single geography, creating significant targeting reach for advertisers within a given location.
2. Security. Telcos are among the most regulated and privacy-compliant industries in existence, making them credible and trusted providers of identity infrastructure.
3. Connectivity. Telcos can leverage a network that spans mobile, fixed-line, and broadband — sitting above the OTT layer entirely.

Vodafone has already moved in this direction, launching TrustPid — a persistent carrier-level ID at the mobile ISP level, designed to be immune from cookie blocking and IP address masking. The ID is generated from various parameters, assigns user activity to a persistent identifier, and allows advertisers to serve targeted ads to mobile users without exposing personally identifiable details.

More telcos are expected to test the universal ID model as it becomes one of the top alternatives to third-party cookies in programmatic advertising.

Data Clean Rooms

Data clean rooms represent another high-value opportunity. They allow brands and publishers to exchange data securely — matching their respective first-party datasets — while reducing the risk of breaching privacy laws and eliminating the need for third-party cookies.

A telco-operated data clean room can be used to:

• Match advertiser data against customer data to build new targeting segments
• Create lookalike audiences
• Measure campaign performance
• Run broader data analysis

This is a solution that extends the value of a telco's existing customer database without requiring third-party identifiers, making it resilient to the current wave of privacy changes.

CTV and OTT Advertising

The connected TV (CTV) and over-the-top (OTT) space creates distinct monetization opportunities for telcos. One illustrative example: Verizon Media and Vizio announced a data partnership in 2021 whereby Verizon Media gained access to Vizio's Inscape viewership data from more than 18 million opted-in Smart TVs globally. Under that arrangement, the data was made exclusively available to Verizon's demand-side platform (DSP), with Verizon serving as the preferred supply-side platform (SSP) for Vizio's programmatic ad inventory.

This kind of integration illustrates the opportunity for telcos to bridge TV and mobile advertising, building cross-device experiences that few other players are positioned to offer. With access to premium inventory and rich first-party data, telcos that deploy purpose-built AdTech platforms in the CTV/OTT space can drive meaningful performance and efficiency for advertisers.

What the End of Third-Party Cookies and Mobile IDs Means for Telcos

Google announced it will stop supporting third-party cookies in Chrome by the end of 2023. Apple and Mozilla have already implemented anti-tracking features in Safari and Firefox that block third-party cookies and other tracking mechanisms by default.

Apple has also restructured access to its mobile identifier — the Identifier for Advertisers (IDFA) — requiring app developers and AdTech companies to explicitly request user consent before collecting it. Estimated opt-in rates range from 4% to 40% depending on the survey methodology and app category.

These changes are driven by a converging set of forces: consumers, privacy advocates, and governments pushing for greater user privacy and transparency in digital advertising.

For telcos, this creates a structural opening. They hold large, first-party datasets that do not depend on third-party cookies or mobile IDs, and they are well-positioned to offer identity infrastructure — universal IDs, clean rooms, carrier-level tracking — that helps advertisers navigate a post-cookie environment. However, telcos must ensure their own data practices comply with applicable privacy laws, including the GDPR, through proper consent collection and data governance.

Which Telcos Have Entered AdTech?

Over the past decade, a number of large telcos acquired AdTech companies, only to sell them — often at a loss — within a few years. The pattern is worth examining closely.

Why Did AT&T Sell Xandr (Formerly AppNexus)?

In June 2018, AT&T acquired AppNexus — at the time positioning itself as the largest independent digital advertising exchange — for a reported $1.6 billion. The strategic rationale was to integrate AppNexus with AT&T's first-party data, premium video content, and distribution infrastructure, with the broader ambition of becoming a dominant player in digital advertising to rival Google and Facebook.

In December 2021, AT&T announced it would sell Xandr (the rebranded AppNexus) to Microsoft for a reported $1 billion — a $600 million loss in roughly three years. AT&T executives indicated the company had stepped back from its ambitions to dominate digital advertising.

"Xandr is also a potential case study in mismanagement."

Why Did SingTel Sell Amobee?

In 2012, Singapore-based SingTel acquired Amobee — an AdTech platform helping advertisers buy inventory across websites and mobile devices — for $321 million. The goal was to offset declining revenues from traditional SMS and call services (undercut by OTT services like WhatsApp) and establish a significant mobile advertising presence.

In July 2022, SingTel announced it would sell Amobee to Tremor International, an Israel-based AdTech company, for $239 million — an $82 million loss over a decade. SingTel described the sale as part of a strategic reset to sharpen its portfolio focus.

"According to SingTel, the divestment is in line with SingTel's strategic reset to sharpen its business focus…"

Why Did Verizon Sell Yahoo!?

In 2017, Verizon acquired Yahoo! for $4 billion with the stated goal of building a multibillion-dollar media empire. Yahoo! was placed under the Oath brand alongside AOL, Yahoo! Sports, TechCrunch, and Engadget. Oath was later rebranded to Verizon Media in 2019.

Verizon's intent was to challenge Google and Facebook's dominance in digital advertising by assembling a portfolio of media properties with substantial audience reach.

In May 2021, Verizon Media announced it would sell Yahoo! and AOL to Apollo Global Management Group for $5 billion — a nominal gain on the purchase price, though the years of operational complexity and write-downs complicate any straightforward reading of the outcome. Verizon stated that media and advertising were no longer core to its business.

"The sale signals that Verizon will focus on its internet-provider businesses as rivals continue to explore media."

Why Have Telcos Failed to Make It in AdTech?

Reviewing the exit stories above reveals consistent patterns.

Acquisition ≠ integration. Simply buying an AdTech company does not mean the telco can turn it into a profitable business unit. Regardless of whether the acquired platform was profitable beforehand, extracting value requires deep operational integration. For telcos attempting to combine their data assets with newly acquired AdTech infrastructure, the technical challenges are significant. Combining disparate systems is not plug-and-play, and the central question — how do we activate user data across this combined tech stack? — often goes unanswered.

Underestimating the competition. Telcos that set out to "take on Google and Facebook" were, in many cases, setting themselves up to fail. Google owns search advertising through Google Search and YouTube and dominates the open web. Facebook owns social. Competing with either requires not just capital but a differentiated strategic position. Independent AdTech companies have been attempting this for years, with only a handful finding durable success.

Misaligned expectations on ROI. Acquiring an AdTech company for hundreds of millions or billions of dollars carries inherent risk. If the acquisition doesn't generate a return, the telco is left with an expensive, highly complex piece of technology that few internal stakeholders understand or can extract value from. This is the dynamic that has led several telcos to write down AdTech assets and divest.

What Should Telcos Do Instead?

Despite the high-profile failures, the opportunity for telcos in AdTech remains real. The mistake was not in entering the space — it was in the strategy of acquiring large, established AdTech companies and expecting transformation to follow automatically.

Telcos are better served by building AdTech capability around their existing assets: their data, their infrastructure, their inventory, and their customer relationships.

Building rather than acquiring offers several structural advantages:

• Ownership of the tech, IP, and data
• Control over the product roadmap
• Full customizability of the platform
• Reduced risk relative to a large acquisition
• Easier integration with existing systems and data infrastructure

The primary trade-off is time. Building an AdTech platform from scratch typically takes 6 to 12 months to reach a minimum viable product (MVP) stage. It will also cost more than renting an off-the-shelf platform, though considerably less than a major acquisition. The build approach, however, produces technology that is designed to fit the telco's actual business needs — rather than an acquired platform that must be retrofitted to a different organizational context.

The table below summarizes the key trade-offs across acquiring, renting, and building:

Advantages of Building AdTech Platforms for Telcos

To summarize the case for custom development:

• Telcos design software to their exact technical and business requirements
• The platform integrates cleanly with existing data infrastructure and systems
• Product direction can be adjusted incrementally as market conditions or stakeholder priorities evolve
• The telco retains full ownership of the technology, data, and intellectual property
• The risk profile of a well-scoped development project is materially lower than a large acquisition

T-Mobile has demonstrated that targeted AdTech acquisitions — focused on niche markets and smaller startups — can work. But even small acquisitions introduce technical incompatibility and integration risk. For most telcos, a custom-build approach offers more control and a cleaner path to a functioning, profitable AdTech business.

How Telcos Can Ensure Success in AdTech Through Custom Development

The most critical success factor in building AdTech platforms is domain expertise on the engineering side. Understanding AdTech from a business perspective is already challenging for most telcos; understanding it at a technical level is harder still.

A software engineer who doesn't understand what a demand-side platform (DSP) is cannot realistically build one that works correctly within the programmatic ecosystem. The success of any AdTech development project depends heavily on the engineering team's knowledge of how AdTech platforms function — what they do, how they integrate with each other, and where the technical bottlenecks lie.

The established approach is to engage engineers with direct experience in programmatic advertising technology: RTB infrastructure, bid request handling, data pipelines, DSP/SSP integration, and identity resolution. Without that foundation, even well-resourced development projects can produce platforms that fail to perform in a live programmatic environment.

Case Study: SSP Development for a Telecommunications Company

A large telecommunications company in Asia undertook a project to design and build a custom AdTech platform to monetize its advertising inventory.

The resulting platform was built to handle 800 bid requests per second, supports image, text, and video ad formats, and is integrated with multiple demand-side platforms (DSPs) — enabling the telco to sell its ad inventory programmatically at scale.

This illustrates what a focused, purpose-built AdTech development project can deliver: a platform scoped to the telco's specific inventory and data assets, integrated with the broader programmatic ecosystem, and capable of operating at production scale from launch.

Telecommunications companies occupy a genuinely advantaged position in the AdTech market — rich first-party data, geographic scale, network infrastructure, and regulatory credibility. The failures of the past decade were largely failures of strategy and integration, not evidence that telcos lack the underlying assets to compete. For telcos approaching AdTech with clear goals, realistic timelines, and engineering teams that understand the programmatic landscape, the opportunity is substantial.