Verizon is selling off Yahoo and AOL, two old-school internet companies that Verizon acquired when it bought out the remains of former internet giant, Yahoo. Though the two have been largely irrelevant in the world of social media and mobile apps, they still provide a forum for newer internet services to gain a foothold. We’ll continue to update this post with live coverage of the events as they happen.
Yahoo and AOL will officially be acquired by Apollo Global Management, according to a statement from Verizon. The telco firm will retain the Yahoo and AOL brands under a new name: “Oath.” Oath will be led by Tim Armstrong, the former CEO of AOL. Armstrong recently stepped down from his position as the head of AOL after Verizon bought the company.
Here’s what you need to know:
credit Richard Drew/Associated Press
Verizon Communications announced Monday that it has agreed to sell Yahoo and AOL to Apollo Global Management for $5 billion, signaling that it has ended its media business.
The sale also includes Verizon’s advertising technology business. Verizon will retain a 10 percent stake in the overall business, the company said in a statement.
Yahoo’s next evolution will be its most exciting, Verizon Media chief Guru Gowrappan said Monday in a memo to employees that came into the hands of The New York Times.
Mr. Gowrappan will continue to lead Verizon Media following the transaction.
This deal is the latest twist in the story of two early Internet pioneers. Yahoo was the first site on the Internet to catalog the breakneck pace of new websites that emerged in the late 1990s. AOL used to be the service that most people went online with.
But both companies were eventually supplanted by more nimble startups like Google and Facebook, although Yahoo and AOL still publish successful websites like Yahoo Sports and TechCrunch.
The sale marks a departure from the strategy Verizon deployed in 2015 when it acquired defunct internet giant AOL for $4.4 billion. The purchase is expected to open the way for Verizon to enter the mobile market, with the goal of using AOL’s advertising technology to sell ads in digital content. Verizon doubled down on this strategy in 2017 by buying Yahoo for $4.48 billion and merging it with AOL under the Oath umbrella.
But Google and Facebook have proven to be formidable competitors in the digital advertising market. Verizon acknowledged their strength in 2018 when it downgraded Oath by $4.6 billion, attributing in part to increased competition and market pressures that resulted in lower-than-expected revenue and profit.
Still, the company generates a lot of revenue. The company reported first-quarter revenue of $1.9 billion, up 10 percent from a year earlier.
This is an opportunity for Apollo to further invest in the digital media sector, a sector it has already invested in with deals with Shutterfly, Rackspace and Cox Media. And he has a lot of experience with spin-offs from companies like Verizon Media.
Apollo aims to accelerate its revenue growth by focusing on individual brands that it believes are lost in the larger corporate empire. It could be more premium subscriptions to Yahoo Finance or more sports betting and fantasy leagues within the Yahoo Sports business, Apollo executives told The New York Times.
Apollo is also optimistic about the prospects for digital advertising as more money is invested in these efforts, although some of the bigger players, such as. B. Google, will be closely investigated by the authorities. And as post-pandemic advertising shifts from offline to online, Apollo expects the entire sector to grow.
Is most of that money going to Google, Facebook, Snap and Twitter? Sure, said Reed Reiman, a private equity partner at Apollo. But do other digital media companies, like Yahoo and others, have a role to play in capitalizing on the rising tide? Absolutely.
Former President Donald J. Trump continues to deny the outcome of the 2020 presidential election.Credit…Erin Schaff/The New York Times
Facebook’s oversight board, an independent, international committee created and funded by the social network, plans to announce Wednesday whether former President Donald J. Trump will be allowed to return to a platform that has been a critical megaphone for him and tens of millions of his followers.
This decision will serve as a model for how private companies that manage social media deal with political expression, including false information spread by political leaders.
Mr. Trump was indefinitely blocked by Facebook on the 7th elected. January after using his social media accounts a day earlier to incite a crowd of supporters to storm the Capitol. Trump has refused to admit defeat and claims the votes were stolen from him.
At the time Facebook banned Trump, CEO Mark Zuckerberg wrote in a post: We believe that the risks associated with allowing the President to continue to use our service during this period are simply too great.
Two weeks later, the company referred Trump’s case to Facebook’s regulators for a final decision on whether the ban should be permanent. Facebook and its board members have stated that the board’s decisions are binding, but critics are skeptical of the board’s independence. Critics say the commission is the first body, similar to the Supreme Court, to deal with online speech and is funded by a private company that has a reputation for not enforcing its own rules.
Facebook’s approach to political statements has been inconsistent. In October 2019, Zuckerberg said the company would not fact-check political speeches, saying that even politicians’ lies deserve a place on the social network because it is in the public interest to hear the ideas of all political leaders. But Mr. Trump’s comments on Jan. 6 were different, the company said, because they incited violence and threatened a peaceful transfer of power in the election.
On Monday, Trump continued to deny the election results.
From this day forward, the fraudulent 2020 presidential election will be known as BIG FALSE! reads his e-mail statement.
Gregory Abel, now considered the heir apparent to Warren Buffett, attended Berkshire Hathaway’s annual shareholder meeting on Saturday.Credit…Yahoo Finance/Via Reuters
For years, the biggest question for Warren E. Buffett has been who will succeed him as head of Berkshire Hathaway, the conglomerate he has built into a $631 billion behemoth over more than 50 years.
Finally, the answer came: Gregory Abel, a 59-year-old lieutenant who oversees Berkshire’s non-insurance business.
The directors have agreed that if anything happens to me tonight, Greg will drive me in the morning, the 90-year-old said. Buffett in an interview with CNBC that aired Monday.
The arrival of this company comes at a time when Berkshire is facing new challenges. At the company’s annual shareholder meeting Saturday, investors questioned Berkshire’s missed lucrative business opportunities during the pandemic and the company’s reluctance to share information about its efforts to combat climate change and increase the diversity of its workforce.
Mr. Buffett said he and his board of directors have been thinking for years about who would take his place when he retires. Last year, for example, he wrote in his annual letter to investors: Berkshire shareholders have nothing to fear: Your company is 100% ready to go.
But this lack of transparency is resented by corporate governance experts and increasingly by shareholders: BlackRock, which owns 5 percent of Berkshire, said this weekend that it voted against the re-election of the head of Berkshire’s management committee because the succession plan had not been adequately disclosed.
On Monday, BlackRock declined to comment on Mr. Buffett’s information.
For many, Mr. Abel’s name as Berkshire’s heir confirmed what they already suspected.
Abel’s star began to rise in 2008 when he was appointed chief executive of then-MidAmerican Energy, an energy company Berkshire had bought eight years earlier. Mr. Abel was involved in a series of acquisitions that made the unit, renamed Berkshire Hathaway Energy, one of the largest utilities in the United States.
We like Abel a lot, said James Shanahan, an analyst at Edward Jones. He has proven to be a very effective leader of Berkshire Hathaway Energy.
Mr. Abel was named vice chairman of Berkshire in 2018, alongside Ajit Jain, who has long led Mr. Buffett’s massive insurance business. Analysts and investors interpreted the decision as a signal that both men are candidates to succeed Mr. Buffett as CEO.
Karl T. Munger, Buffett’s longtime business partner, hinted Saturday at Berkshire’s annual shareholders meeting that Mr. Abel could become Berkshire’s next leader. Asked if the company might become too complex to manage, Munger said: Greg will maintain the culture, a task Mr. Buffett has long emphasized as important for the future leader of Berkshire.
A restaurant in Birmingham, Michigan, last month. Listed companies and companies with more than 20 subsidiaries are not eligible.
Restaurants, bars, caterers and other food businesses affected by the pandemic can now apply for a new $28.6 billion federal grant fund. Applications will be accepted starting at noon today.
Impatient candidates are ready to pounce. The Independent Restaurant Coalition, the group that pushed for the relief fund, is encouraging business owners to apply as soon as the application system opens.
We know these funds are in high demand and likely to be distributed quickly, said Erika Polmar, executive director of the coalition.
The Restaurant Revitalization Fund, administered by the Small Business Administration, provides grants of up to $10 million. The amount each company can receive is the difference between its gross receipts in 2019 and 2020, less certain other forms of federal assistance, such as. B. Appropriations for Salary Security Program.
Listed companies and companies with more than 20 branches are not eligible.
Starting Monday, all eligible businesses can apply, but for the first 21 days, the Small Business Administration will only accept applications from businesses whose owners belong to one of the priority groups established by Congress when it created the fund: Women, veterans and people who are considered socially and economically disadvantaged.
The agency said the latter group includes people who meet certain income and asset limits and are black, Hispanic, American Indian, Asian/Pacific Islander or South Asian.
Applicants from these groups will be asked to confirm their eligibility for the exclusivity period. This three-week priority period alone could exhaust the fund.
Funding from Congress likely won’t be enough to meet existing demand, Patrick Kelly, director of the S.B.A.’s Office of Access to Capital, said in a webinar last week. He said he hopes Congress will make more money available if needed.
Applicants can register on the agency’s website or directly with select sales technology vendors, including Toast and Square. The S.B.A. has stated that it aims to respond to requests within 14 days.
This is the second grant program the agency has recently launched. Last week, it began accepting applications for a $16 billion grant for venue operators, a fund designed to help theaters, music clubs and other live performance businesses. Nearly 9,500 companies applied on the first day of the program, but the agency has not yet made a decision on grant awards.
On Monday, Apple and Epic Games, makers of the popular game Fortnite, will face off in a lawsuit that could determine how much control Apple has over the app economy. The trial will begin with testimony from Tim Sweeney, a top executive at Epic, explaining why he thinks Apple is a monopolist abusing its power.
The trial, which is expected to last about three weeks, has serious implications, Jack Nickas and Erin Griffith report in the New York Times. If Epic wins, it will turn the economics of the $100 billion app market on its head and allow millions of companies and developers to avoid having up to 30 percent of app sales go to Apple.
Epic’s victory will also intensify the antitrust battle against Apple. Federal and state regulators are scrutinizing Apple’s control of the App Store. On Friday, the European Union accused Apple of violating antitrust laws regarding app rules and pricing. Apple is facing two new federal lawsuits over App Store fees – one from developers, the other from iPhone owners – demanding class-action status.
This victory over Apple also bodes well for Epic’s upcoming lawsuit against Google over the same problems with the App Store for Android devices. The case is expected to go to trial later this year and be decided by the same federal judge, Yvonne Gonzalez Rogers, of the Northern District of California.
But if Apple wins, it will consolidate its control over mobile apps and silence its growing critics, further increasing the power of a company that is already the most expensive in the world and has generated more than $200 billion in revenue in the past six months.
By: Ella Coese – Data delayed by at least 15 minutes – Source: FactSet
- The S&P 500 Index was up about 0.5 percent in early trading Monday, while the Stoxx Europe 600 Index was up 0.2 percent. In Asia, the indices ended lower.
- The S&P 500 ended April up 5.2%, its biggest monthly gain since November.
- Oil prices fell, as did 10-year government bond yields. In London, markets were closed due to the holiday and trade was generally subdued as some countries celebrated Labour Day. May celebrated.
- Investors may have been thinking about inflation after Warren E. Buffett said Saturday at Berkshire Hathaway’s annual shareholder meeting that the cost of
building materials is rising.
- Shortages in several sectors, including construction, are driving up prices, Alan Rappeport and Thomas Kaplan report in the New York Times. This tension stems from growing demand challenged by supply chain disruptions and Trump-era tariffs.
- Although the Federal Reserve has called the price increases temporary and unlikely, the pressure on the Biden administration to intervene could well increase as it seeks a $2 trillion infrastructure investment package – an amount that could rise with the cost of building roads, bridges and electric vehicle charging stations.
- According to the IHS Markit Purchasing Managers’ Index for April, European manufacturing companies reported significant increases in production and new orders.
- The seasonally adjusted index was 62.9 points, the highest level since the survey began in 1997, IHS Markit reported Monday.
As the economy recovers from the pandemic, the prices of items as diverse as toilet paper, diapers and hardwood floors are on the rise – an increase that could soon impact consumers’ wallets.
Procter & Gamble is raising prices on products like Pampers and Tampax in September. In March, Kimberly-Clark announced that it would increase the prices of toilet paper from its Scott, Huggies and Pull-Ups brands in June to offset a significant increase in product costs.
And General Mills, the maker of cereal like Cheerios, has seen supply chain and transportation costs rise due to increased demand, CFO Kofi Bruce said recently.
The price increase reflects what some economists call a major shift in the way companies responded to demand during the pandemic, Gillian Friedman writes in the New York Times.
Before the virus, retailers often had to bear the costs when suppliers increased the price of goods, as fierce competition forced them to keep prices stable. The pandemic has made a difference.
Offices for Instagram, which is owned by Facebook. Facebook has expanded its Manhattan office. linked to credit Gabby Jones for The New York Times
Those who profit from corporate America’s use of office space are trying to convince them to return to the office.
They improved their sales offerings with an emphasis on air filtration systems, flexible lease terms and commuter spaces, and brokers returned to their full-time positions. They acknowledge that some things have changed, but at the same time they want to prove to their clients and themselves that the firm will soon be back to the way it was, writes Rebecca R. Ruiz in the New York Times.
With New York City fully open in July and many companies expecting workers to return this summer and fall, players in the commercial real estate industry are hoping that the recovery they have been waiting for will finally happen.
We opened our offices as soon as we got permission to expand across the country, says David Lipson, vice president of Savills, an international brokerage firm. If you work in an office building, is it too easy to work from home?
The sector, which has been growing steadily, has seen its commissions decline as vacancy rates reach their highest levels in decades. Property managers, who are generally optimistic about the future, are faced with existential questions.
With 1.3 billion square feet of office space in major U.S. markets – and Manhattan now has more space for sale than all of Nashville, Orlando and San Antonio, according to research firm CoStar – the optimistic outlook is skewed.
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Frequently Asked Questions
How much did Verizon pay for Yahoo?
Verizon has officially announced that they have purchased Yahoo’s core business for a cool $4.8 billion, and it’s easy to see why. Yahoo has been a force in the internet world since its founding in the early 90s, and it has a solid user base of over 1 billion users worldwide. That strength is especially notable in the US, where Yahoo is the number three search engine behind Google and Bing, and the number one email provider. But Verizon isn’t interested in Yahoo’s search or email; they’re looking for Yahoo’s ad revenue. In the years since the dotcom boom, Yahoo has struggled to find a place in the big leagues of internet advertising. (They even tried to purchase Google back in the day, but were turned Verizon and Yahoo are teaming up and Verizon has agreed to buy Yahoo for $4.8 billion. Yahoo confirmed the deal in a statement, and Verizon executives said in a separate statement that the deal will “enable Verizon to disrupt the digital advertising and media ecosystem.”
Why did Verizon buy Yahoo and AOL?
Verizon is the latest company to join the hunt for a slice of the ad-selling, content-hosting pie previously dominated by Google and Facebook. The telecom giant has been on a buying binge as it looks to get bigger and better in an effort to catch up with the rest of the industry. It’s a risky move, but one that could pay off in the long run. (Verizon is rumored to have been in talks with other rival content providers, such as Huffington Post, but nothing seems to have come of that.) Verizon, one of the largest wireless providers in the United States, has recently acquired Yahoo, one of the largest online media providers in the United States. The move comes as an attempt to diversify Verizon’s business, as they are primarily known for their wireless service. Some experts are unsure how the acquisition will affect both companies, since they don’t have many overlapping services.
How much did Verizon pay for AOL?
Verizon’s $4.4 billion purchase of AOL was finalized today, as the last of the “big four” telecom companies consolidates into an even bigger three. Verizon’s acquisition of AOL is the largest in the history of corporate America, and provides the company with access to AOL’s high-speed internet service, go90 mobile video service, and even its media network (through sites like Engadget, TechCrunch, and The Huffington Post). Verizon has spent a lot of money on acquisitions lately, buying up AOL and Yahoo over the past few months. They are hoping to create a big digital media empire, and though it’s too early to tell just what will come of it, Verizon’s recent purchases could be a good sign for the future of online media.
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