Verizon has recently purchased AOL. Tim Armstrong pitched to ad buyers in a Las Vegas elevator. Imagine if a hotel chain supplied Verizon with a database of its frequent guests. The three data platforms could be used to target guests with ads for promotional offers. Armstrong aims to build the top mobile media company in the world by 2020 by reaching 2 billion users (currently at 700 million users). He also wishes to generate $10-$20 billion in revenue (currently generates $2.7 billion in revenue per year). This would put AOL in a position to compete with Facebook and Google. Armstrong's empire would gain a boost if Verizon bought Yahoo, but Yahoo's mobile advertising is down this year. AOL was on a downward spiral until Verizon purchased AOL and bought AOL out of the AOL-Time Warner Merger. Armstrong was named CEO of AOL in 2009 and has since then bought the Huffington post, a strategy built around advertising technology. Once AOL was purchased by Verizon, Verizon gave Armstrong control of Verizon Digital Media Services, the company's collection of video and advertising businesses, including a mobile-video app called go90. Armstrong staying with the company was critical to the deal made between the companies. He will be awarded $59 million if he stays at Verizon for four years. Some consider him the successor to Mr. McAdam, current CEO.
This is an interesting topic because AOL is seen as an underdog. It has been taken under Verizon's wing and the CEO has very big ambitions for the company.
This article is related to our class because it shows how competitive the market is and how advertising and video streaming technology is vital to any social media prosperity.
http://www.wsj.com/articles/aols-tim-armstrong-aims-to-build-digital-ad-empire-at-verizon-1459330200
March 30,2016
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