iWorld
Verizon acquires AOL for $4.4 billion
MUMBAI: Taking another significant step in building digital and video platforms to drive future growth, Verizon Communications Inc. has acquired AOL Inc. for an estimated total value of approximately $4.4 billion.
AOL chairman and CEO Tim Armstrong will continue to lead AOL operations after closing.
Verizon’s acquisition further drives its LTE wireless video and OTT (over-the-top video) strategy. The agreement will also support and connect to Verizon’s IoT (Internet of Things) platforms, creating a growth platform from wireless to IoT for consumers and businesses.
The combination of Verizon and AOL creates a scaled, mobile-first platform offering directly targeted at what eMarketer estimates is a nearly $600 billion global advertising industry. AOL’s key assets include its subscription business; its premium portfolio of global content brands, including The Huffington Post, Tech Crunch, Engadget, MAKERS and AOL.com, as well as its millennial-focused OTT, Emmy-nominated original video content; and its programmatic advertising platforms.
Verizon chairman and CEO Lowell McAdam said, “Verizon’s vision is to provide customers with a premium digital experience based on a global multiscreen network platform. This acquisition supports our strategy to provide a cross-screen connection for consumers, creators and advertisers to deliver that premium customer experience.”
“AOL has once again become a digital trailblazer, and we are excited at the prospect of charting a new course together in the digitally connected world. At Verizon, we’ve been strategically investing in emerging technology, including Verizon Digital Media Services and OTT, that taps into the market shift to digital content and advertising. AOL’s advertising model aligns with this approach, and the advertising platform provides a key tool for us to develop future revenue streams,” he added.
Armstrong said, “Verizon is a leader in mobile and OTT connected platforms, and the combination of Verizon and AOL creates a unique and scaled mobile and OTT media platform for creators, consumers and advertisers. The visions of Verizon and AOL are shared; the companies have existing successful partnerships, and we are excited to work with the team at Verizon to create the next generation of media through mobile and video.”
The transaction will take the form of a tender offer followed by a merger, with AOL becoming a wholly owned subsidiary of Verizon upon completion.
The transaction is subject to customary regulatory approvals and closing conditions and is expected to close this summer.
Verizon expects to fund the transaction from cash on hand and commercial paper. The company also continues to expect to return to pre-Vodafone transaction credit ratings in the 2018-2019 timeframe.
Transaction advisers for Verizon were Lion Tree Advisors; Guggenheim Partners; and Weil, Gotshal&Manges. AOL advisers were Allen & Company LLC and Wachtell, Lipton, Rosen & Katz.
iWorld
Snap hits $1B revenue as subscriptions cross 25 million
Snap’s paid products boom with Snapchat plus, Lens plus and creator subscriptions
CALIFORNIA: Snapchat’s subscription push is paying off handsomely, with the platform’s direct revenue business now cruising past a $1 billion annualised run rate. At the heart of this milestone is a loyal global subscription community that has just topped 25 million Snapchatters.
Since its launch in late 2022, Snapchat plus has grown rapidly to become one of the fastest-growing consumer subscriptions worldwide. What began as an early-access perk for the platform’s most engaged users has scaled into a robust revenue engine alongside Snap’s ad business.
Snapchat plus thrives because it taps into something deeply human. With more than 946 million monthly active users, Snapchat is fast approaching the one-billion mark. Its subscription service offers personal touches that matter in everyday chats. From pinning a best friend to customising chat wallpapers or adding a Bitmoji Pet, these simple features bring warmth, context and joy to conversations.
But Snap isn’t stopping there. The company has expanded its direct revenue offerings with paid versions of Lens plus, Snapchat Platinum, and Memories Storage Plans. Lens plus gives subscribers advanced AI and AR creative tools, including exclusive generative AI Lenses and unlimited use of the Imagine Lens for instant image creation. Snapchat Platinum delivers an ad-light experience focused on friends and creators, while Memories Storage Plans give heavy users the option to upgrade storage and keep thousands of their most cherished Snaps safe.
Snapchat is also opening doors for creators. Its new creator subscriptions let fans pay directly for exclusive content, priority engagement, and ad-free Stories, giving influencers fresh ways to connect with their audience.
Snap credits its 25 million subscribers for helping shape the future of the platform. Their creativity, feedback, and enthusiasm not only inspire new features but also fuel Snap’s growing direct revenue business.
With these moves, Snap is proving that personalisation, self-expression, and friendship aren’t just buzzwords, they’re the secret sauce behind its subscription success.
