×
You will be redirected back to your article in seconds

Verizon CEO: Combined Yahoo-AOL Will Be Platform to Test Over-the-Top Video Service

The long and tortuous sale of Yahoo’s internet business to Verizon is expected to close around the middle of June, according to Verizon chairman and CEO Lowell McAdam.

And once the deal is completed, Verizon would use the combination of Yahoo and AOL — with a total of 1.3 billion users — as the “platform… to test out an over-the-top service,” said McAdam, speaking at J.P. Morgan’s Global Technology, Media and Telecom Conference in Boston.

The exec didn’t provide any additional details on a possible OTT offering, which would be in addition to the telco’s Go90 ad-supported mobile video service. Verizon has reportedly been mulling an internet-delivered skinny bundle offering, akin to AT&T’s DirecTV Now and Dish Network’s Sling TV.

Verizon is paying the NFL some $21 million for rights to the Sept. 24 regular-season game between the Baltimore Ravens and Jacksonville Jaguars in London, and the telco will stream the game live across its portfolio of video platforms including AOL, Yahoo, Fios TV, Go90 and Complex.com. “That all goes to the AOL-Yahoo strategy,” McAdam said, meaning Verizon expects to amplify the distribution of the NFL live-stream across a large global audience.

The integrated AOL-Yahoo operation, housed under the newly created Oath division, will be organized around key content-based pillars: news, sports, finance, entertainment, and lifestyle. It will be led by current AOL CEO Tim Armstrong; Yahoo chief Marissa Mayer will not be part of the Oath management team.

Verizon’s deal for Yahoo is valued at about $4.5 billion, after the telco negotiated a $350 million discount in the wake of Yahoo’s two massive data breaches last fall.

McAdam noted that Verizon has shied away from engaging in “transformational” mergers and acquisitions, because “you end up with AOL Time Warner, things that are difficult to manage.”

The CEO again alluded to remarks he made in an interview last month in which he said the company would be open to M&A talks with Disney, CBS or Comcast if the opportunity arose. “I’ll say this about M&A: There’s a lot more energy on Wall Street and in the media than there is in most businesses at this point,” McAdam said. That said, “If there were an opportunity to accelerate the strategy, you should look at that.”

Said McAdam, “People want to know what we’re going to buy next, and we haven’t even closed on Yahoo yet.”

Verizon’s core focus is building out fiber-based networks and next-generation 5G wireless, McAdam said, noting the company’s $1 billion deal with Corning announced last month under which Verizon will buy up to 20 million miles of fiber-optic cable over the next three years. Verizon this summer is launching a test of 5G, which has the capacity to deliver 1 gigabit per second to wireless devices.

“On the connectivity side you can make a very good return [on investment],” McAdam said. “Consumers’ eyes light up when you can deliver a gigiabit to the handset.”

More Digital

  • BuzzFeed logo

    BuzzFeed Set to Lay Off 15% of Its Employees

    BuzzFeed is slashing its workforce by 15% in a move to boost the internet-media company’s profitability and “focus on content that is working,” according to a memo from CEO Jonah Peretti sent to staffers Wednesday. The cuts will be made next week, according to Peretti’s memo. BuzzFeed has about 1,450 employees worldwide, so around 218 [...]

  • Verizon New Logo

    Verizon Media Laying Off 800 Employees, or 7% of Staff in AOL and Yahoo Group

    Verizon is cutting 7% of the employees in its media group, or around 800 staffers in the division that combined AOL and Yahoo. “This week, we will make changes that will impact around 7% of our global workforce across the organization, as well as certain brands and products,” Verizon Media Group CEO Guru Gowrappan wrote in [...]

  • cheddar

    Cheddar Now on All U.S. OTT Streaming Services, Preps Primetime Programming Block

    Video-news startup Cheddar is launching its live-streaming news networks on Sony’s PlayStation Vue, making it the first content provider to span all over-the-top subscription services in the U.S. The company, founded in 2016, operates two networks — the newly rebranded Cheddar Business, positioned as a CNBC-style financial and business network for millennials, and Cheddar News, [...]

  • Avi Saxena - Discovery

    Discovery Hires Amazon's Avi Saxena as CTO of Direct-to-Consumer Unit, Will Open Seattle Office

    Discovery hired Avi Saxena, former VP of technology for Amazon Marketplace, as chief technology officer of direct-to-consumer. Saxena reports to the guy who was his boss at Amazon: Peter Faricy, who was appointed CEO of Discovery’s Global Direct-to-Consumer division in August 2018 and who headed up the Amazon Marketplace third-party seller business. In the newly created [...]

  • Spaces Terminatro VR Experience Goes Live

    Comcast-Backed Spaces Launches San Jose Location With 'Terminator' VR Experience

    Comcast-backed virtual reality startup Spaces is getting ready to open its second California location in San Jose next month: The company has teamed up with Cinemark to open a new VR center at the Century 20 Oakridge and XD theatre in San Jose on February 8. The new Cinemark Spaces center will open with “Fight for [...]

  • Sean Hannity Reveals Broadband Plans for

    Sean Hannity Reveals His Plans for Fox News Streaming Service (EXCLUSIVE)

    Sean Hannity sometimes tells younger colleagues at Fox News Channel that he is “the bridge between two generations of Fox” because he has been part of its primetime lineup since 1996. Now he may serve a similar purpose for a third. Fox News will next week bring Hannity to the world of video-streaming, launching “Hannity [...]

More From Our Brands

Access exclusive content