BMO said investors should be "pleased" with the acquisition of Anvato by Google, owned by Alphabet Inc (NASDAQ: GOOGL).

Anvato provides a software platform that fully automates the encoding, editing, publishing and secure distribution of video content across multiple platforms. The move makes sense, as video advertising is touted as the next big thing in the marketing space.

Customers of Anvato include many cable and broadcast outlets, including: Fox Sports, NBCU, CBS Local, Scripps, Univision and PBS.

Terms of the deal were not disclosed and BMO doesn't expect anything more until the 10Q. Like Google, Anvato is headquartered in Mountain View, California.

"Investors should be pleased with a deal that supports both core operations (we expect YouTube to benefit) and emerging ones (Cloud). Google's "competitor-partner" positioning to the media industry may cause some client friction, but we expect good diligence was done with the largest customers," analyst Daniel Salmon wrote in a note.

Responding to investors query that if large internet/consumer tech companies would buy big content assets, Salmon said "Google is making a modest acquisition that capitalizes on its strengths (customer user experience, computing power, etc.), while also fundamentally becoming a more important "content" player due to Anvato's focus on the vertical."

Salmon has an Outperform rating on Alphabet, which is also the analyst's top pick in the sector. The analyst maintained his $925 price target on the stock.