While much of the talk about mobile and social advertising has been around native solutions, Twitter?s acquisition of MoPub steers the company in another direction that positions it more heavily in display.

The acquisition of MoPub will help Twitter build out the advertising business on its real-time bidding mobile and desktop platforms. Although mobile display advertising has its own set of challenges, marketers may be more comfortable advertising with Twitter as advertisers put more of an emphasis on cross-device campaigns.

?This is a very big step for Twitter,? said Dave Martin, senior vice president of media at Ignited, El Segundo, CA. ?It takes them out of the native advertising business and into the business of mobile display advertising. 

?It is a big jump ahead of Facebook in terms of ad products and targeting,? he said. ?The mobile display ecosystem is still in its infancy, and this move gets them ahead of Facebook in terms of what they can offer advertisers broadly across the mobile landscape.?

Real-time mobile
Twitter cites the increase in mobile usage and programmatic buying as the reason behind the acquisition, per a blog post from the company.

MoPub?s technology allows advertisers to manage inventory and optimize different sources of advertising via one product. MoPub will continue to operate its own services despite the acquisition.

Terms of the deal were not announced, but according to an article published by Techcrunch, Twitter paid $350 million in stock for the company.

The story also reported that Millennial Media was interested in snatching up MoPub in a bid to build up the mobile ad network?s focus on real-time bidding, which Millennial took one step towards with its acquisition of Jumptap last month (see story).

MoPub will give Twitter the ability to match buyers and sellers to purchase automated inventory on sites and applications outside of Twitter, and with the company?s trove of data on users, the opportunities for targeted mobile advertising is significant.

MoPub?s clients include Flixster, OpenTable and WordPress.

?Acquiring MoPub instantly puts Twitter into the conversation about targeting mobile display ads, whereas before advertisers really only considered Twitter an effective native advertising and publishing platform,? Mr. Martin said.

?They?ll also be able to track ROI for advertisers better than they?ve been able to in the past and will have a more well-rounded suite of ad products that better matches what many mobile advertisers are looking for,? he said.

Social is mobile
With rumors that Twitter is preparing for its IPO, the social giant is also likely taking a few clues from Facebook since the latter company has been relatively successful with generating revenue from mobile since its IPO last year. Mobile represented roughly 40 percent of Facebook?s revenues during the second-quarter of 2013.

Although challenges around the user experience persist, it seems that advertisers have latched on to Facebook?s mobile ad units as a way to connect with consumers as they increasingly access social networks primarily via mobile.

?This is a great move for Twitter as it allows them to jump-start their own exchange to compete against Facebook's FBX,? said Howie Schwartz, CEO/founder at Human Demand.

?Facebook saw from the public market post their IPO the importance of having a solid mobile advertising play, [and] Twitter was able to learn from this and is prepping mobile prior to a future IPO,? he said. ?This is a strong step for the mobile ad ecosystem overall as it adds additional audience and targeting data to help close the gap versus desktop digital spend.?

Twitter?s deal also positions the company in more direct completion with Google?s AdMob.

The difference with Twitter though is that since MoPub is an ad exchange, it can be used as an internal ad server for publishers to prioritize direct clients that pay a premium for CPM, and the ads are served before an impression goes up for auction on real-time bidding, according to Marc Poirier, cofounder and executive vice president of business development of Acquisio, Brossard, Canada.

However, the sheer size of Google will be a challenge for Twitter.

?Google can capitalize on their massive base of AdWords clients to sell their inventory,? Mr. Poirier said.

?Twitter and MoPub cannot compete on this side of the equation, so I expect that MoPub winning business over AdMob will be an uphill battle,? he said. ?Getting advertisers to pay attention is going to require time and money. And if there's not enough buyers, CPMs will remain low.?

Real-time focus
Earlier this year, Twitter debuted its television ad targeting product, which lets marketers tie a social message to a TV ad when they are likely using a smartphone and tablet as an additional screen.

With a real-time bidding component to this type of advertising, Twitter could take its mobile efforts up a notch in helping the cross-screen advertising scale.

"Imagine relevance as a dartboard ? in-feed keyword targeting hones in at the moment customers vocalize intent,? said Alex Jacobs, vice president and director of social marketing at DigitasLBi, San Francisco.

?Twitter TV Targeting gets closer reaching an audience primed by entertainment experiences,? he said.

?Now MoPub's mobile real-time bidding moves marketers even closer to efficiently reaching customers wherever, whenever and to scale. Add them up and Twitter might be getting close to a bulls eye."

As marketers increasingly look for mobile advertising to scale across not only mobile but also desktop, the deal signifies the importance that real-time bidding is playing for advertisers.

In fact, Nexage recently reported that more than half of its revenue on its exchange come from real-time bidding.

?First, this is a loud and enthusiastic validation of the ad exchange model and programmatic in general,? said Victor Milligan, chief marketing officer at Nexage, Boston.

?It also clarifies the acute value of a strong independent market,? he said. ?Premium publishers compete for consumers? attention and loyalty, and they compete for ad spend ? and especially more lucrative brand spend. No premium publisher will want to outsource its revenue stream and growth potential to a competitor."

Final Take
Lauren Johnson is associate reporter on Mobile Marketer, New York