Verizon, offering telecommunications products and services, has announced a deal to purchase Internet company Yahoo Inc. for $4.8 billion. Verizon will pay out another $1.1 billion to cash out Yahoo’s restricted stock. This would allow Verizon to become a meaningful player in the digital media industry, which could be as large as $180 billion by 2020,
The acquisition of Yahoo, which still requires approval from federal regulators, follows Verizon’s purchase of online service provider AOL last year for $4.4 billion.
Yahoo will now be combined with AOL, creating the third-largest digital advertising company after Google and Facebook.
Verizon’s purchase of Yahoo and, separately, its growth in wireless means the company has access to more consumer data than ever before. That information could become one of its most valuable assets as it seeks to become an advertising giant. . Verizon states traditional TV bundles are beginning to fray, and more media consumption is moving to smartphones, especially among the new generation.