Back in May of last year, Verizon Wireless acquired AOL for $4.4 billion. And now, the chief executive of AOL, Tim Armstrong, makes no secret of his mission to transform Verizon into a powerhouse in the field of digital advertising, one that would give Google and Facebook a run for their money.
Speaking to the Wall Street Journal, Armstrong provides a scenario in which a hotel chain would supply Verizon Wireless with a database of its most loyal customers. This information could be cross-referenced with the wireless carrier’s own formidable database harvested from over a hundred million subscribers, and further boosted with AOL’s own data, could be used in targeting hotel guests with promotions for new offers. In turn, the hotel chain’s data can be matched up with Verizon’s database in order to determine the volume of people actually paying a visit to the hotel chain.
To be clear about it, AOL does not have that capability yet (maybe later this year), but it does highlight Armstrong’s vision of building a digital-advertising empire by decade’s end that reaches a couple of billion customers while generating revenues somewhere between $10 billion to $20 billion.
As reported by the Wall Street Journal, Armstrong’s plans could be helped immensely if Verizon acquired Yahoo’s core operations. Yahoo has already requested potential buyers to hand in their preliminary bids by April 11, and one of the leading prospective takers is Verizon. Sure, Yahoo is no longer a leader in terms of digital-advertising, but it does have tremendous reach, with a billion monthly users, including 600 million on mobile. In order for Armstrong’s vision for Verizon to come true, the Big Red may need to acquire Yahoo’s massive user base.