This week in the LATAM Roundup: Predicta acquires Melt DSP in Brazil. Now renamed Predicta Melt, the company will offer programmatic solutions both for sell side and buy side; YouTube's audience in Brazil surpasses Pay TV; and, finally, Video on Demand market numbers for the top thre markets in Latin America: Brazil, Mexico, and Argentina. 

Predicta acquires Melt DSP

Predicta, the Brazilian company part of e.Bricks portfolio and RBS’s digital investment branch, announced a deal to buy Melt DSP. The deal establishes a new company: Predicta Melt. They will position themselves as a programmatic and digital solutions hub, with a portfolio containing not only a DSP, but also ad servers, rich media, web intelligence, DMP, website optimisation, ad exchanges, and adsense.

The value of the deal wasn’t disclosed. It’s worth mentioning that Melt DSP received RBS investment in 2012, applied in the company’s expansion. “When we started, the first months were very difficult, but three months later we had 100% of operations made programmatically, and then we closed deals with big companies in the sector such as OpenX, AppNexus, Google”, said Guilherme Mamede, founder, Melt DSP. He is now vice-president of new business at Predicta Melt.

Predicta’s adserver is a consolidated solution in the Brazilian market. The company is one of the first local startups to build their own ad network. Recently, Predicta have been shifting towards more advanced programmatic solutions. This way, the acquisition of Melt makes sense — bringing in a DSP solution.

“In Predict Melt we have both the buy side and the sell side, and a better view for the publishers. When you see only the buy side or the sell side, you don’t actually understand the reality of the market for the ones at the other side of the chain. We now have a great advantage compared to our competitors”, said Mamede. According to him, the company aims to grow their revenue between 60% and 80%.

The acquisition also reinforces the partnership that both Melt and Predicta had with Google. Whereas Predicta had been offering Google’s inventory optimisation solutions, Melt has been working on activation and optimisation of campaigns using DoubleClick Manager.

YouTube’s audience in Brazil surpasses Pay TV

In Brazil, 40% of the time spent watching videos is done in the internet. The data is from VideoViewers, YouTube’s measurement of the video market in the country.

The research also estimates that 42% of the population (85 million people) has the habit of watching videos on the internet, and 82 million people do so in YouTube. This percentage is bigger than Pay TV, whose audience is estimated in 37% of the local population.

The average time spent watching videos has risen from 30 hours a week to 39.2 hours week in the past two years. Whereas general TV average time has grown less than one hour in this period, online videos has jumped: online video share has risen from 27% to 42% of the time. Additionally, the percentage of people who spend more time watching videos on the internet compared to any other media has more than doubled: from 12% in 2014 to 30% 2016.

According to the survey, the audience on YouTube is interested in music and comedy videos (46%).

Mobile devices also represent an important factor in the video scenario. They represent more than half of the time spent watching online videos (55%); 88% of the surveyed people also associate the word 'videos' with YouTube: ahead of other social media such as Facebook (73%) and WhatsApp (65%) and, most importantly, ahead of general TV (28%) and pay TV (33%).

Brazil reaches 8th position in the VOD market

The Brazilian market of Video on Demand (VOD) has now 30 services operating locally. New data from a recent study made to Motion Picture Association Latin America (MPA-AL) and the local Union of Audiovisual Industries (SICAV) brings a new forecast for 2016: VOD is expected to reach US$352.m (£283m) in Brazil.

This way, the country reaches the eighth position in the global market, led by the United States. Globally, PwC estimates that VOD revenues will reach US$18.3bn (£14.72bn) this year.

Brazil is also the largest Latin American VOD market, twice as big as the second place in the region, Mexico, whose revenues are estimated to be US$188m (£151.2m). Argentina is the third largest market, where revenues should reach US$124.8m (£100.4m).