All the Yahoo rumours remind me of its parallels with AOL, and question a potential mobile takeover
Yahoo's board is pondering a sell-off of its "core internet businesses" over the next couple of days, as it also mulls the future of existing chief executive Marissa Mayer, according to multiple reports citing sources close to the developments.
These reports first emerged yesterday in the Wall Street Journal, which also reported the same meetings would also see board members debate whether or not it should continue with a planned spin-off of its Chinese e-commerce interests (i.e. its cash cow) Alibaba.
I can't comment on the veracity of the sources cited in these reports, but with other titles already lining up potential replacements for Mayer (citing an openly available letter from an activist investor) it's probably fair to say that something big is afoot.
It's worth mentioning that Yahoo has declined to comment on any of these reports and speculation, but I'd like to reference recent public remarks from AppNexus president Michael Rubenstein, the great sage of the 'ad tech power game'.
Speaking at ATS New York a little over a month ago, he told attendees that Yahoo being taken private, and essentially reborn, was a distinct possibility. And given that he's an influential and smart person, I'd lend credence to his point of view.
Many sources have claimed the outfit's "core internet businesses" are prime for a private equity takeover. However, I'd hasten to add that a potential takeover from one of the telecoms industry's behemoths is also a twist of fate worth considering.
I have covered the ad tech/digital media space for the last few years, and prior to that spent some time covering the telecoms sector, and, particularly in the 'big data' era, notice how the two sectors are converging faster than ever. We need only look at this year's sale of AOL to US telecoms giant Verizon Wireless as evidence of that.
It's on the AOL comparison that I'd develop my point further, as it was not so long ago that similar media reports claimed the fate of AOL and Yahoo was likely to be intertwined. Instead, it could be argued that the two are likely to become mirror images of one another, and that's not necessarily a bad thing.
Comparing the AOL, Yahoo assets
We need only look at Yahoo's recent repositioning/rebrand of its ad tech offering; from Yahoo Ad Exchange (YAX) to consolidating all its constituent parts under the BrightRoll brand.
Many had noted how the choice of the BrightRoll (the programmatic video platform it purchased this time last year) brand as a similar positioning to AOL, with its heavy emphasis on its video offering post its purchase of Adap.tv.
AOL first lifted the lid on its AOL One platform in March last year, with the company touting its unified platform - and data-driven insights - as much more transparent means of using programmatic media buying technologies.
With BrightRoll offering consisting of its DSP, ad exchange (which is integrated to over 100 demand-side platforms, or DSPs) as well as its mobile analytics offering Flurry (which it acquired in 2014), it does give advertisers access to inventory across devices.
A recent report from research firm Forrester noted how both AOL and Yahoo's video DSPs finished within the top 10 of its results, but did note they had 'some catching up to do', and both outfits do have high audience figures given their respective web properties.
Combine the ad tech with the operator audience insights, and it might just be worth it. Also, fuse this with Yahoo's highly thought-prized data sets (and many media buyers are quick to point out that Yahoo's data sets are highly useful) and it could prove a highly valuable asset.
If you think how this could be enhanced with mobile operator data - arguably the richest audience insight assets on the market - then increasingly such an outfit could prove a serious proposition for telecoms chief executives eager to future-proof their businesses.
After all, are mobile operators not increasingly putting themselves in the advertising ring with reports of O2 itself getting into the advertising game with a tie-up with the most unashamed ad blocker in the business Shine Technologies?
But which operator?
It's on the above point, that I'd like to raise the prospect of O2-owner Telefonica at least taking a look at how Yahoo could fit into its offering - by pure coincidence Yahoo's recently appointed UK managing director Nigel Clarkson is himself a man of much mobile experience, having previously worked within O2 ranks.
Telefonica - a global telecoms behemoth with almost 350 million subscription accounts across 21 markets (notably in Latin America) - itself has made various attempts to monetise its audience insights, the latest being its Axonix offering.
To go back to the AOL/Verizon comparison, outgoing AOL president Bob Lord recently explained to The Drum how that pairing hopes to leverage the network operators’ global relationships with other telecoms providers, as well as the ad tech outfit's with media buyers to offer true scale to advertisers.
So if you think about the global footprint of Yahoo (particularly in Asia where its brand still finishes ahead of Google in many places), along with Telefonica's extensive presence in Latin America and Europe, then such a pairing could prove particularly formidable.
I will hasten to add, this is just pure speculation on my own behalf, but one that I think at least bears contemplation given that global mobile operator groups are increasingly investing in ad tech, particularly those from APAC.
We need only look at Japan based Softbank (which itself is a stakeholder in Yahoo Japan) and how it has invested in outfits such as InMobi, and more recently digital advertising outfit Yieldify.
It also owns US operator Sprint, plus Nikesh Arora - who just like Mayer is an ex-Googler - joined the outfit last year, with analysts also linking it so such a move, according to the most recent Wall Street Journal update.
Elsewhere, we need only consider how Australian operator Telstra is hoovering up various interests in ad tech outfits such as Ooyala. The list goes on...
Of course, buying out a behemoth such as Yahoo would be a much bigger prospect than investing a few million here and there, but surely one of the world's large operator groups will be thinking it's at least worth a inquisitive phone call.
Ronan Shields is digital editor at The Drum