As you may have heard, Verizon has just proposed buying AOL for $4.4 billion, and that’s a bigger deal than you might at first think. Here’s how it will affect you.
AOL? What, Verizon wants to get into dial-up?
Actually, they want to get into advertising: AOL’s kept the lights on over the last decade or so building a suite of online advertising tools. It also happens to own Huffington Post, as well as Moviefone, TechCrunch, and a bunch of other websites, which Verizon is very interested in.
The short answer is that people are using mobile platforms to access the internet more, including watching video and scrolling through websites. Currently, the biggest fight in technology right now is between content providers like Netflix and the networks they use, like Verizon. Remember, Verizon, Comcast, and the other ISPs were just handed a major defeat on net neutrality. Their immediate response was to start turning into content providers. You might notice that Hulu, which is partly owned by Comcast, has suddenly developed a huge appetite for exclusive content after it became clear they weren’t going to be able to charge websites more money.
Ah, so Verizon wants to sell the ads surrounding that content?
Yep. In fact, that’s all most people want to talk about, from a business perspective. Verizon has essentially set itself up to make money off your internet traffic whether or not you use their network.
Oh man, does this means I’ll see more ads on mobile sites?
Possibly, although it seems unlikely Verizon is going to screw up your web browsing with one weird trick for reducing neck fat. Instead, you might expect to see more ad-supported services, like, for example, that content they just bought, and expect Verizon to start getting aggressive in selling ads.
Please tell me they’re not going to buy a beloved sitcom and make it impossible for me to see it unless I’m on Verizon.
Yeah, that’s probably going to happen. But when everybody gives up on that strategy in five years and resells the rights, we’ll have some really awesome Netflix.