Verizon Grabs AOL for $4.4 Billion — Good Buy?

With the future in mind, Verizon Communications is making a bold -- and expensive -- step to build its digital and video platforms. The telecom giant has inked a deal to acquire Internet legend AOL. Verizon will pay $50 per share for a total value of about $4.4 billion.

Verizon said the acquisition will beef up its LTE wireless video and OTT (over-the-top video) strategy. Beyond the obvious, the deal will also support and connect to VerizonEUs Internet of Things (IoT) platforms, helping the company expand from wireless to IoT for consumers and businesses.

EUVerizonEUs vision is to provide customers with a premium digital experience based on a global multiscreen network platform,EU said Lowell McAdam, Verizon chairman and CEO. EUThis acquisition supports our strategy to provide a cross-screen connection for consumers, creators and advertisers to deliver that premium customer experience.EU

A Multi-Billion Opportunity

Most people who use the Internet have used -- or at least heard of -- AOL. Once known as America Online, AOL has staked a claim in the digital content world and advertising platforms space.

EUAt Verizon, weEUve been strategically investing in emerging technology, including Verizon Digital Media Services and OTT, that taps into the market shift to digital content and advertising,EU said McAdam. EUAOLEUs advertising model aligns with this approach, and the advertising platform provides a key tool for us to develop future revenue streams.EU

Merging AOL with Verizon will create a scaled, mobile-first platform targeting what eMarketer has assessed as a $600 billion global advertising industry. Verizon immediately picks up AOLEUs subscription business, portfolio of global brands like Engadget, The Huffington Post, TechCrunch, and AOL.com, as well as Emmy-nominated original video content and programmatic advertising platforms.

EUVerizon is a leader in mobile and OTT connected platforms, and the combination of Verizon and AOL creates a unique and scaled mobile and OTT...

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