Verizon Inks Deal To Acquire Yahoo For $4.83 bn

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by Yahoo! Inc. has agreed to sell its core operations to US telecom giant Verizon Communications Inc. for $4.83 billion in a transaction that marks the end of the Internet pioneer as an independent company after a two-decade-long journey.

Greyhound Research Chief Analyst and CEO Sanchit Vir Gogia said that, through this acquisition, Verizon is trying to go beyond devices and data and targeting content and advertising revenue. The merged entity will better compete with Google, Facebook and Microsoft, he said.

“Facebook has content, advertising, and free data (experimenting with drones). Google also has content, advertising, and free data (Google Fiber). Microsoft recently bought LinkedIn for content, advertising and Internet data,” Gogia said. “Now the fight is between Google, Facebook, Microsoft and increasingly Verizon.”

The acquisition won’t have much impact on Yahoo’s India business, Gogia said.

He said that Verizon has no presence of devices and data in India. Unless Verizon develops AOL or any other content ecosystem in India, it won’t be able to fight Google and Facebook. Google and Facebook have a mature content and advertising business and Yahoo doesn’t even stand a chance in India.

“Yahoo India’s presence is more from R&D perspective. If not change, it’s going to improve because in India Verizon will have to put more people to increase the work on advertising and analytics,” Gogia said. “In the long term, Yahoo and AOL put together will need more muscle in terms of people to drive more content and ad revenues to rival Google and Facebook.”

Source: Tech Circle

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