2017.12.04 Corporate Announcement
Platforms will be linked to take advantage of each company’s strengths, and bring about better quality ad distribution to meet market needs for video marketing
TOKYO – December 4, 2017 – LINE Corporation (“LINE”) entered into a capital alliance with FIVE Inc. (“FIVE”) – a developer, seller, and operator of a video ad platform for smartphones – in order to bolster LINE’s ad distribution business. This alliance makes FIVE a wholly owned subsidiary of LINE.
In 2014, FIVE launched its pioneering video ad distribution platform in Japan and has introduced such services as “Video Network by FIVE” (for performance-based ads) and “*Moments by FIVE” (specialized for brand ads). Since its release, the company has seen massive growth and, at present, has the largest scale of user reach for video ads in Japan (app monthly average users: over 28 million; website unique users: over 32 million). Additionally, FIVE has partnered with over 1,800 media partners – including high quality premium mobile apps – and has over 400 advertisers, showing significant growth and expansion in its business in just three years’ time.
LINE went into full-scale operation of its performance-based advertising platform, LINE Ads Platform, in June 2016. From Q4 2017, LINE has expanded its ad locations (ad inventory) from Timeline and the LINE NEWS news service in the LINE app to include other parts of the LINE platform, including its digital comic service LINE Manga and blogging service LINE BLOG. The company has also launched a variety of initiatives, such as developing an array of distribution options and improving targeting precision. As a result of these efforts, the service is being used – and praised highly – by approximately 3,000 businesses and brands. LINE is continuing to steadily grow and expand the business.
The goal of this capital alliance is to bolster both advertising platforms by leveraging FIVE’s technology and resources specialized in video advertising to improve the video ads on the LINE Ads Platform and LINE and its related services, in addition to integrating the FIVE’s video ad platform business base, made up of its over 1,800 media partners, with LINE’s abundant audience data from its over 71 million MAU in Japan.
Further, LINE will be evaluating bringing the business to the global market, including Thailand, Taiwan, and Indonesia – key regions where it has built up impressive user bases.
This capital alliance will allow both companies to provide their advertisers with even more appealing advertising options, as well as provide FIVE’s media partners with an even stronger monetization scheme.
The SDKs and services currently provided by FIVE can still be used as-is even after this alliance.
<Comment from Takeshi Idezawa, Representative Director, President and Chief Executive Officer of LINE Corporation>
FIVE has shown incredible growth as a company. It is unmatched in its strengths, including its ad platform business base, made up of its media partners centered around quality mobile apps, its advanced technology specialized in video advertising, and talented resources. As a result of this capital alliance, and through collaboration between FIVE and LINE, the companies will make use of their respective strengths and further accelerate the growth and expansion of the ad distribution business. LINE will endeavor to provide a valuable and appealing service to advertisers, media partners, and users.
<Comment from Keisuke Kanno, Representative Director and CEO of FIVE Inc.>
For these three years since our launch, my desire to create a product and business that will make a meaningful change in the world has constantly been on my mind. Meanwhile, LINE Corp. is a global company that time and again has brought about their own impressive innovations.
By moving forward with LINE and bringing together our strengths, FIVE will be able to attain an even higher vantage point. I look forward to providing even greater value to mobile internet users through video marketing, and all the possibilities that entails.
Overview of this transaction
Stock Transfer Agreement execution date: December 4, 2017
Planned stock acquisition date: Mid-December 2017
Overview of FIVE Inc. https://www.five-corp.com/
Representative Director and CEO: Keisuke Kanno
Corporate headquarters: Ebisu-West 5F, 1-16-15 Ebisunishi, Shibuya-ku, Tokyo
Established: October 24, 2014
Business: Development and operation of platform for distributing videos to smartphones
Video Network by FIVE
A video ad network specializing in performance-based ads, this service maximizes marketing ROI by bringing the largest scale of user reach in Japan together with its unique creative service.
*Moments by FIVE
The largest-scale branding marketplace in Japan, this service hand-picks only quality premium apps and websites, and boasts an impressive user reach in addition to its many exclusive ad locations. Effective brand building is possible over mobile.
What is the LINE Ads Platform?
The LINE Ads Platform is a performance-based ad platform for services related to the LINE chat app operated by LINE Corporation. The service went into full-scale operation in June 2016 when it started distributing ads to the LINE Timeline and LINE NEWS. Since its launch, it has been used by approximately 3,000 businesses and brands (as of the end of September 2017) and LINE Manga was added as an ad space in October 2017.
Advertisers use a special admin panel to set the details (including budget, time period, user attributes, and creatives) and make bids, and the LINE Ads Platform system chooses an ad and shows it to users. By switching to a performance-based ad system, many more businesses are now able to post ads, which they were previously unable to due to limitations on the numbers of slots, or for budgetary reasons. Further, since advertisers can monitor their ad displays, their effects, and other details as they operate their ads, they can conduct promotions with limited budgets and distribute ads to fit sales prospects, goal achievement rates, and more.