×
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

  • Clevver-Logo

    Hearst Magazines Buys Clevver's Pop-Culture YouTube Channels After Defy's Demise

    Hearst Magazines has snapped up Clevver, a network of female-skewing lifestyle and pop-culture news YouTube channels that had been owned by now-defunct Defy Media. Clevver was left homeless after Defy’s sudden shutdown in November; its principals said at the time they were looking for a new home. Hearst Magazines sees a digital fit with Clevver’s [...]

  • "Brother" -- Episode 201-- Pictured (l-r):

    CBS Interactive's Marc DeBevoise on Streaming Boom, Content Strategy, and Apple

    Not everyone wants or needs to be Netflix to succeed in the streaming space. And not everyone sees Apple’s enigmatic new service as a threat. Even as rival streaming services offer gobs of content, CBS Interactive’s president and COO Marc DeBevoise sees the company’s targeted original programming strategy continuing to attract viewers to its All [...]

  • Rhett-Link-Good-Mythical-Morning

    Rhett & Link's Mythical Entertainment in Talks to Acquire Smosh (EXCLUSIVE)

    Smosh, the YouTube comedy brand left stranded after parent company Defy Media went belly-up, may be about to get a new business partner. Mythical Entertainment, the entertainment company founded by top YouTube comedy duo Rhett & Link, has been in talks about acquiring the Smosh brand, sources told Variety. Multiple potential buyers came forward to [...]

  • Pokemon Go

    Proposed 'Pokémon Go' Lawsuit Settlement May Remove Poké Stops, Gyms

    A proposed settlement in the class action lawsuit against “Pokémon Go” developer Niantic could remove or change a number of Poké Stops and Gyms in the popular augmented reality game. The proposed settlement was filed in a California court on Thursday and applies to anyone in the U.S. who owns or leases property within 100 meters [...]

  • Skyline of Doha at night with

    Qatar's beIN Rallies Support From U.S. Companies Against Pirate Broadcaster beoutQ

    Qatari powerhouse beIN Media Group has rallied support from American sports and entertainment entities, including Discovery and Fox, behind its request that the U.S. government place Saudi Arabia on its watch list of top intellectual property offenders. The Doha-based broadcaster, a state-owned spinoff of Al Jazeera news network, accuses the Saudi government of harboring pirate broadcaster [...]

  • Carlos SlimMexican tycoon Carlos Slim participates

    Carlos Slim’s America Movil Looks to Invest $8.5 Billion in Latin America This Year

    América Móvil general director Daniel Hajj has announced that Carlos Slim’s Mexican conglomerate plans to invest $8.5 billion in Latin American in 2019, focusing primarily on fiber-optic infrastructure and updated mobile technologies such as 4.5G and 5gG. In a conference call with analysts, following the company’s recap of fourth quarter results, Hajj laid out the [...]

More From Our Brands

Access exclusive content