Vodafone and EE to withdraw from Weve following O2 buyout

The joint mobile advertising venture between O2, Vodafone and EE has come to an end after O2 confirmed it will buy out the other partners.

EE and Vodafone UK will withdraw from Weve and sell any remaining assets to O2 UK, which is currently in the process of being acquired by Hutchison Whampoa for £10.5bn.

O2 said it will continue to operate Weve as a wholly owned subsidiary – with O2’s digital director, David Plumb, claiming it will be more “agile” with just one owner.

Weve, which gives brands access to around 21 million opted-in consumers, was set up in 2013 with its sights set on the lucrative and expanding mobile advertising and payments market. It launched a series of products and services, including location based messaging, app discovery messaging, targeted push SMS and video messaging.

However, it abandoned a ‘wallet service’ focused on loyalty, vouchers, payments and data analysis and has faced stiff competition, particularly from banks and tech firms such as Apple.

O2 said it will give Weve access to its 20 million opt-ins through O2 Priority – with six million customers – and O2 Wi-fi, which currently has 14 million customers.

According to O2, Weve grew by 45 per cent in 2014, while the mobile digital advertising market almost doubled to £850 million in the same time.

“With O2’s heritage in digital services and as a pioneer in digital advertising, we are perfectly placed to capitalise on this potential,” Plumb said. “We are therefore pleased to announce that after a strategic re-evaluation of the joint venture, O2 is acquiring Weve.

“With more data sets and richer analytics, it will be better and with only one owner to answer to, it will be faster. Through this acquisition we will be able to offer our business customers the platform to offer their customers more personal and contextually relevant offers.”

The FT reports that Weve made a loss in its first year of about £25m on revenues of about £13m. It employs about 90 people.

This is an edited and expanded version of the original article, published at 10am on Tuesday 5 May.