VZ/Yahoo!: “The next step is: How do we differentiate our strategy?”

Kara Swisher has a short interview with Verizon/AOL’s Tim Armstrong on the Yahoo! buy, which is still “pending of course.” It’s hard to take any interview about a pending acquisition on super face-value (no one wants to show their hand), but there’s some good indication that Verizon followed the “we’ll sort out the strategy details post-sale” plan. Armstrong himself says they’ll be working on figuring out differentiating, and “sources” say:

Verizon has had little insight into a number of issues, including the terms of the contracts with key employees, that it will need to make plans for the future.

I like the theory that the goal is, really, just to optimize the existing business:

“The deal that we contemplated is about growing the company and did not start with synergies,” said Armstrong. “We will be walking through a pretty direct process about what is structure and then cost structure and there will be synergy, but it is not at the top of our list.”

That seems like a low-risk plan. They’d be the biggest site by eyeballs in the US, which ain’t bad.

Also, more coverage from Reuters on the “RemainCo” company of Alibaba and Yahoo! Japan, and a cameo from Rita McGrath in a Will Oremus’s piece at Slate:

“It’s a beautiful example of a company that has a lot of indispensable pieces, but they don’t add up to an indispensable whole,” says Rita McGrath, professor of management at Columbia Business School. Yahoo’s problems, she believes, stemmed from “a fundamental unwillingness to choose” what kind of company it wanted to be.

And, 451 has their report out, by Rich Karpinski and Scott Denne. Some highlights:

  • “AOL generates roughly $1bn from its owned media properties – Yahoo pulls in 3.5x that amount.”
  • My summary of one of their points: as mobile use grows and grows, over the next 5-10 years, there’s a window for new top-dogs to emerge and take market-share. Seems like a legit theory. 451 describes the market here as: “opportunities in telecom data as a service, a market combining digital advertising, proximity marketing and an array of big-data insight services that 451 Research forecasts will grow to a $79bn addressable opportunity by 2020”
  • They’re not big on the advertising technology and networking component in Yahoo!.
  • There’s some indication that Verizon’s digital business is doing well, so maybe they’re pretty good at integration acquisitions.
  • There’s also details on the financials of “RemainCo.”

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