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Verizon out to be more than 'dumb pipe' with Yahoo buy
[SAN FRANCISCO] Verizon is focusing on synergies, not job cuts, with its multi-billion-dollar buy of faded internet star Yahoo, executives said Monday at a TechCrunch Disrupt conference here.
AOL chief Tim Armstrong said that while there were likely to be "job changes" at Yahoo if the US$4.8 billion acquisition closes as expected early next year, the deal was about combining strengths in "a bold strategy for the future".
Mr Armstrong did not lay out details, saying the strategy was still taking shape with input from Yahoo chief executive Marissa Mayer and her team.
While Verizon executive vice president and president of innovation and new business Marni Walden took part in the on-stage talk with Mr Armstrong, regular Disrupt guest Mayer was noticeably absent.
Verizon bought AOL last year in a deal valued at US$4.4 billion, and the Yahoo acquisition is another move in building an online media platform on top of the US telecommunication firm's network.
"We do not want to be a dumb pipe," Ms Walden said, playing off a question by the moderator at TechCrunch, which is owned by AOL.
"We also want to be a platform and a services company; our lead in mobile lets us take advantage of that."
Verizon on Monday ramped up its internet-of-things platform with the acquisition of Silicon Valley-based Sensity Systems, which specialises in LED light systems that connect online.
Financial details were not disclosed.
Mr Armstrong said the Yahoo acquisition is on track, with "enthusiasm on both sides internally". Yahoo went with Verizon after a process involving 51 possible bidders, according to a recent filing with the US Securities and Exchange Commission.
Verizon commands about 35 per cent of the US wireless market, according to data at industry tracker Statistica.com.
Mr Armstrong has steered AOL since 2009 - first when it was part of the Time Warner conglomerate, then as an independent company, and since last year under Verizon.
Both he and Yahoo chief Ms Mayer were early employees at Google.
Mr Armstrong's "Project Everest" strategy reorganised AOL and helped focus on digital media, investing in the Huffington Post and other news sites, while strengthening its ad-tech services.
Arianna Huffington, founder of the Huffington Post news site that has become a global phenomenon, announced last month that she was stepping down to launch a nonprofit group focused on health and wellness.
Greek-born Huffington launched her original American website in 2005 and sold it to internet giant AOL in 2011.
She said she would be stepping down as editor-in-chief of the Huffington Post, which now operates in 10 languages and has a user base of over 200 million.
Mr Armstrong, who heads the AOL unit that includes the Huffington Post and other news sites, called Arianna Huffington "a visionary who built the Huffington Post into a truly transformative news platform".
Mr Armstrong on Monday sidestepped expanding on whether internal friction played a role in Ms Huffington's departure, describing her as a "world class talent" and telling of a going away party held last week.
"People in the media love the drama," Mr Armstrong said of her departure.
"It's not show friends, it's show business."
Mr Armstrong said he believed combining Verizon's online media offerings will be a winning formular "if we have the high ground". He also said he thinks of Google, Facebook, Apple, Amazon and other online titans as partners, not rivals.
"We are not planning on competing with Facebook and Google," Mr Armstrong said of the media platform Verizon is building.