Taboola Merges With Outbrain To Create One Big Content-Recommendation Company

Not many people know them, especially in the world occupied by social media networks. But they are indeed two of the biggest online-content-recommendation companies.

Taboola and Outbrain are two longtime rivals. Both are Israeli companies, which use widgets to place recommended links to articles, videos, and products across hundreds of publisher websites. The two are mostly known for their "Sponsored" posts that appear near the bottom of many articles.

In other words, the two are very much alike.

Taboola however, has long billed itself as an alternative to Google and Facebook, by creating its own discovery ways for users to scout the web, without using those U.S-based tech companies.

But since Google and Facebook are conquering the market more than ever, the regulatory calls for their break up grow louder.

This is where Taboola and Outbrain are taking their chances by coming together to form a new company that is stronger than ever.

Rumors of a possible merger between the two companies have risen frequently since at least 2015.

The two companies are merging into one entity, operating under the Taboola name, with Outbrain shareholders receiving 30% of the shares and $250 million in cash.

According to Taboola's CEO Adam Singolda, the merging of the combined company will be able to get a bigger share of advertiser dollars, and have what it wakes to take on Google and Facebook.

"There's so much focus on Google and Facebook being too big that it's almost like a rallying cry from the industry to create more choice. We hope that this is a huge win for the industry, giving small and big advertisers more choice in terms of where they can run their ads online and, in turn, help to grow revenue for publishers."
Adam Singolda and Yaron Galai
Founder and CEO of Taboola Adam Singolda (left), and founder and CEO of Outbrain Yaron Galai (right)

While the two companies are big in their own respective ways and influential in the markets, the two have also been criticized for enabling the spread of clickbait and fake news in their widgets.

The two have algorithms to analyze the preferences of different readers, to then offer them the articles that may be of their interest. By putting articles up from advertisers using Native Advertising method, which makes ads naturally integrated into the publishers' content, they can keep readers occupied.

However, most of the time, the two show low-quality clickbait headline and less-than-engaging contents.

This has long sparked some concerns and dislikes from publishers and brands.

Controversial in their own ways, they’re both ludicrously profitable.

Both Taboola and Outbrain made more than $2 billion in revenue combined. Or to be more specific, Taboola’s 2018 profits reached $50 million on revenues of $1 billion.

With the merger, the new Taboola would have 2,000 employees across 23 offices, with more than 20,000 clients.

Coming out strong and ready, the new company however. may not be any less controversial than when Taboola and Outbrain were separate companies.