Verizon Buys AOL For 4.4 Billion In Cash

Verizon Communications on Tuesday announced it plans to acquire ISP AOL for a whopping $4.4 billion in cash. Verizon will pay $50 per share for AOL, with the deal expected to close this summer.

Michael Cusanelli, Associate Editor

May 12, 2015

2 Min Read
Verizon Communications announced it plans to acquire Internet Service Provider AOL
Verizon Communications announced it plans to acquire Internet Service Provider AOL.

Verizon Communications (VZ) on Tuesday announced it plans to acquire Internet service provider (ISP) AOL for a whopping $4.4 billion in cash. Verizon will pay $50 per share for AOL, with the deal expected to close this summer.

The deal is expected to help Verizon expand its video offerings as the mobile phone giant looks to become a leader in what it calls its “over-the-top” video strategy, with additional support for Verizon’s Internet of things (IOT) platform and television content distributed through the Internet, according to The New York Times.

AOL, which is known for its infamous “You’ve Got Mail” sound byte and the company’s purchase of Time Warner in 2000, was formerly the largest Internet services provider in the country during the dial-up era. However, the company has since fallen from grace, and is mostly known as the proprietor of the Arianna Huffington-run e-publication The Huffington Post and for its purchase of companies including TechCrunch and Engadget.

“Verizon’s vision is to provide customers with a premium digital experience based on a global multi-screen network platform,” said Lowell C. McAdam, Verizon’s chief executive, in a statement. “This acquisition supports our strategy to provide a cross-screen connection for consumers, creators and advertisers to deliver that premium customer experience.”

The acquisition will see AOL become a wholly owned subsidiary of Verizon upon completion, according to the announcement. AOL Chairman and CEO Tim Armstrong will continue to lead AOL operations after the deal closes.

The acquisition is evidence of Verizon’s differing strategy from other telecom giants like AT&T (T) as the company looks to separate itself from the competition, said Jennifer Fritzsche at Wells Fargo. The purchase is expected to provide Verizon with a slew of new online advertising platforms, mostly due to AOL’s nearly $600 million in advertising revenue.

Continue checking back with Talkin’ Cloud for more info as the deal develops and be sure to check out our Windows Supersite for additional insight.

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About the Author

Michael  Cusanelli

Associate Editor, Penton Technology Group, Channel

Michael Cusanelli is the associate editor for Penton Technology’s channel properties, including The VAR Guy, MSPmentor and Talkin' Cloud. He has written articles and produced video for Newsday.com and is a graduate of Stony Brook University's School of Journalism in New York. In his spare time Michael likes to play video games, watch sci-fi movies and participate in all things nerdy. He can be reached at [email protected]

 

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