Verizon looking at AOL because of programmatic advertising technology?
Verizon and AOL in a joint venture - or even a takoever - to help the telecoms giant expand mobile-video offerings? That's what insiders are speculating on, according to Bloomberg.
AOL HQ in New York
Verison hasn’t made a formal proposal to AOL, and no agreement is imminent, said the people with knowledge of the matter, who asked not to be named because the discussions are private.
Speaking at a conference yesterday, Verizon Chief Executive Lowell McAdam said the company wasn’t having “significant acquisition discussions” and is more interested in partnerships with media companies and content providers, rather than buying them.
“AOL, along with lots of other media companies, are potential for us to do partnerships,” McAdam said.
Verizon is primarily interested in AOL’s programmatic advertising technology, said Bloomberg, quoting insiders: The automated buying and selling of ads online could be paired with a future online-video product.
With a takeover, however, verizon would also gain paying subscribers and Internet properties including the Huffington Post.
AOL CEO Tim Armstrong has used digital-advertising acquisitions to transform it from the Internet portal once known for its “You’ve got mail” alerts. Verizon is seeking expertise in three areas: online content, mobile video and advertising, one person said, and a venture -- rather than a takeover -- would keep it focused in those areas.
“Verizon needs a digital response and AOL has shown the best strategic foresight of navigating the digital-video world,” said Laura Martin, a senior analyst at Needham & Co yold Bloomberg. “Verizon can buy or build that, but it’s unlikely to build it fast enough.”
Verizon also has held talks with several of AOL’s peers about how to bolster those businesses, one person said.
AOL rose 3.4 percent to $46.25 a share in New York, giving the company a market value of about $3.6 billion. Verizon rose 1 percent to $47.04, for a market value of about $195 billion.
Spokesmen for Verizon and AOL declined to comment.