Yahoo will soon officially be owned by the biggest wireless carrier in the United States. Both Yahoo and Verizon Wireless announced the deal following a bidding process that spanned several months. The Big Red will be paying cash amounting to $4.83 billion in exchange for Yahoo’s core web businesses, which include familiar brands such as Yahoo Mail, Fantasy Sports, Flickr, and of course Yahoo’s search engine, plus the Internet company’s advertising tech. Note that the sale does not include Yahoo’s shares in Alibaba Group Holdings or its shares in Yahoo Japan.
It appears that Verizon Wireless has become a buyer of former Internet powerhouse names. A year ago for instance, the major US wireless carrier had completed its acquisition of AOL for a sum of $4.4 billion. The Big Red is now looking to mer Yahoo with AOL in order to combine a super company that will take on digital advertising behemoths such as Facebook and Alphabet’s Google, two of the most visited websites in the whole world. To date, Facebook and Google hold nearly 43 percent of all digital advertising sales across the globe. On seventh place is Yahoo, capturing only a meager 1.5 percent.
Yahoo was launched by David Filo and Jerry Yang (graduate students from Stanford University) back in 1995. Starting out as a sort of directory for the whole information superhighway, Yahoo eventually evolved into a true Internet portal, not only serving as a search engine, but also delivering news, sports, and entertainment. But the emergence of Google (who also started out as a search engine) and social media giant Facebook in recent years has left Yahoo struggling to stay relevant.
When Marissa Mayer came into the picture (interestingly, she used to work as an executive for Google) as chief executive officer in 2012, she tried to remold the Yahoo brand into a new entity suitable for the mobile device era. Mayer also worked to transform Yahoo into a premier media brand, even hiring personalities such as Katie Couric and acquiring right to TV shows like Community. But some of her high profile initiatives never really took off.
In light of Verizon’s acquisition of Yahoo, Mayer has stated that she intends to stay with the company. However, it should be noted that the entity resulting from the Yahoo and AOL merger will be headed by Marni Walden, an executive vice president and president of product innovation and new businesses at Verizon Wireless.
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