Research, analysis, and thought leadership for enterprise communications.

Verizon Buys AOL

by in Telecom

Verizon is acquiring AOL. Yes, THE AOL that is famous for still having over a million $20 a month accounts that use dial-up Internet access.AOL

It’s the perfect strategic fit for them, and the moment I heard about this merger I was shocked by the synergy between the two companies.

Both companies specialize in over-priced, slow communications. Both seem to consider consumers that are older and who don’t price compare to be their target audience. Both companies have declining networks. And, both companies desperately want out of the businesses that they are now in. Could such a better match be possible?

Verizon recently sold off almost all of their towers. After all, why does a cell-phone company need to own towers any longer? Having coverage isn’t important, having control over your network isn’t important. They sold all of them for the same amount of money the company takes in during two weeks. Why, it was like having 54-weeks of income in a 52-week year. Plus, no more pesky towers to inventory, upgrade, or be responsible for. With that $5 Billion in hard cash they were able to…acquire AOL.

If you were a cell phone company, would you rather own and control all of your towers, or would you rather own and control all of AOL? (Precisely my thinking as well!)

I just can’t wait for those Verizon/AOL floppy disks to show up again. And, remember those modem squeals while making a connection? (OK, perhaps you don’t since it has been over 15 years since I last used one). Wouldn’t it be great if Verizon re-introduced those tools (now so familiar to AOL customers) as a ring-tone?

Go Verizon!


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  • Landry

    It’s the content platforms they are after, not the dial up clients. Also, it’s the air that’s work more than the physical towers – keep in mind a recent $18B investment in additional spectrum blocks. The towers are leased for $5B to American Tower – which as a neutral host operates those towers – giving Verizon access with income. They also sold off wireline assets for some addition $10B. Digital content and advertising where people are is a high growth multi-billion dollar space that I believe balances out a mobile providers portfolio. Not a bad strategy if you ask me.

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Colin Berkshire is a highly technical HR executive in the Pulp and Paper Industry. Colin has an engineering and voice background, and is currently on assignment in Asia. NOTE: Colin does not respond to comments, and does not Tweet.