What Verizon Gets from $4.4 Billion Purchase of AOL
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Justin Sullivan/Getty Images(NEW YORK) — Verizon is buying AOL for $4.4 billion, positioning the mobile carrier as a key player in the realm of digital video.
The deal, which comes out to $50 per share, is expected to be completed this summer.
One of the assets Verizon will get from the transaction is AOL’s subscription service.
While dial-up Internet may seem antiquated, more than 2.1 million people still use it, according to AOL’s first quarter earnings report. These subscribers pay an average of $20.83 for their Internet access, the report says.
Among the other assets are AOL’s portfolio of news brands, including The Huffington Post, TechCrunch, Engadget, MAKERS and AOL.com.
Verizon CEO Lowell McAdam said having AOL’s digital content and advertising platform will help drive Verizon’s strategy as it seeks to monetize over-the-top video and LTE wireless video and create new revenue streams.
“Verizon’s vision is to provide customers with a premium digital experience based on a global multiscreen network platform,” McAdam said. “This acquisition supports our strategy to provide a cross-screen connection for consumers, creators and advertisers to deliver that premium customer experience.”
The deal is still subject to regulatory approvals.
AOL CEO Tim Armstrong is expected to stay on and continue to lead the AOL branch.
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