Verizon To Acquire Yahoo For $4.8B, Will Bolster Mobile Content And Ad Tech Capabilities

Published: July 25, 2016

Telecom giant Verizon Communications Inc. reached a definitive agreement to acquire the operating business of Yahoo! Inc. for about $4.8 billion. The acquisition includes Yahoo’s advertising technology, as well as its other assets such as email, search and messenger.

Verizon said it will combine Yahoo’s mobile content capabilities with the advertising technology of AOL, another company Verizon acquired last year for $4.4 billion, to ultimately compete with the likes of Google and Facebook in the digital advertising space. The acquisition will also enhance Verizon’s mobile media offerings as more buyers turn to their mobile devices to consume content, the company said.

“Just over a year ago, we acquired AOL to enhance our strategy of providing a cross-screen connection for consumers, creators and advertisers,” said Lowell McAdam, Chairman and CEO of Verizon, in a statement. “The acquisition of Yahoo will put Verizon in a highly competitive position as a top global mobile media company and help accelerate our revenue stream in digital advertising.”

Yahoo CEO Marissa Mayer added that the sale of Yahoo’s operating business is an important step in the plan to unlock shareholder value. The company notes that the deal does not include its 15% stake in the Chinese e-commerce company Alibaba, or its 35% interest in Yahoo Japan Corp.

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“This transaction also sets up a great opportunity for Yahoo to build further distribution and accelerate our work in mobile, video, native advertising and social,” Mayer said.

B2B Advertising Experts Weigh In On The Acquisition

B2B marketers could see a very robust cross-device opportunity via the intersection of Verizon and Yahoo, according to Chris Golec, Founder and CEO of Demandbase.

“Yahoo’s exchange and properties have proved to be valuable in helping our customers reach SMB segments and business interested in finance-related topics,” Golec said in an interview with Demand Gen Report. “With Verizon’s mobile-first technology advantage, we expect the acquisition to extend the reach even further into these segments.”

Sources also noted that the acquisition highlights the continued momentum of digital advertising in the mobile and video space.

“The acquisitions should result in more scale from both an inventory and data perspective,” said Eric Spett, Co-founder and CEO of Terminus, in a statement. “It will be exciting to see if the combined business can accelerate revenue from digital advertising and break into double digit market share.”

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