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FALLEN INTERNET STAR: VERIZON BUYS YAHOO, MARKING END OF AN ERA


JULY 25 -In this Nov. 5, 2014, file photo, a person walks in front of a Yahoo sign at the company's headquarters in Sunnyvale, Calif. Yahoo reported Tuesday, April 19, 2016, that after subtracting ad commissions, Yahoo's revenue fell 18 percent from the same time a year earlier, to $859 million. It's the largest decline in Yahoo's quarterly net revenue since the company hired Marissa Mayer as its CEO nearly four years ago. (AP Photo/Marcio Jose Sanchez, File) Verizon is buying Yahoo for $4.83 billion, marking the end of an era for a company that once defined the internet. It is the second time in as many years that Verizon has snapped up the remnants of a fallen internet star as it broadens its digital reach. The nation’s largest wireless carrier paid $4.4 billion for AOL last year. Yahoo will be rolled into Verizon’s AOL operations and CEO Marissa Mayer may be reunited with AOL CEO Tim Armstrong, who worked with her as executives at Google for years and tried unsuccessfully to convince her to combine the two companies when they both remained independent. “We have enormous respect for what Yahoo has accomplished: this transaction is about unleashing Yahoo’s full potential,” Armstrong said in a statement. Most analysts expect the deal to end the four-year reign of Yahoo’s Mayer, a former Google executive who flopped in her attempts to turn around the Sunnyvale, California, company. Mayer, though, told employees in a Monday email that she intends to stay, though she didn’t say for how long. “I love Yahoo, and I believe in all of you. It’s important for me to see Yahoo into its next chapter,” she wrote. Yahoo Inc., Sunnyvale, California, is parting with its email service and still-popular websites devoted to news, finance and sports in addition to its advertising tools under pressure from shareholders fed up with a steep downturn in the company’s revenue during the past eight years. The slump has been deepening even though advertisers have been pouring more money into what is now a $160 billion market for digital advertising, according to research firm eMarketer. READ MORE...

ALSO: Insiders explain the identity crisis that led to Yahoo's demise


JULY 16 -Marissa Mayer said that she still saw a "path to growth" for Yahoo. Mario Tama/Getty Images
When senior Yahoo executives gathered at a San Jose hotel for a management retreat in the spring of 2006, there was no outward sign of a company in crisis.
The internet pioneer, not yet a teenager, had just finished the prior year with $1.9 billion in profits on $5.3 billion in revenue. The tough days of the dot-com bust were a distant memory, and Yahoo Inc, flush with lucrative advertising deals from the world's biggest brands, was enjoying its run as one of the top dogs in the world's hottest industry. But for one retreat exercise, everyone was asked to say what word came to mind when a company name was mentioned. They went through the list: eBay: auctions. Google: search. Intel: microprocessors. Microsoft: Windows. Then they were asked to write down their answer for Yahoo. "It was all over the map," recalled Brad Garlinghouse, then a Yahoo senior vice president and now COO of payment settlement start-up Ripple Labs. "Some people said mail. Some people said news. Some people said search." While some executives said this was a useful management exercise that took place multiple times over the years, it proved an ominous portent of the business troubles to come. Indeed, the demise of Yahoo, which culminated in an agreement this week to sell the company's core assets to Verizon Communications Inc, has been more than a decade in the making. Many of the more than two dozen former Yahoo managers interviewed by Reuters over the past two weeks -- who now occupy executives suites elsewhere in Silicon Valley -- agree that the company's downfall can be traced to choices made by both the executive leadership and the board of directors during the company's heyday in the mid-2000s. Some of the missed opportunities are obvious: a failed bid to buy Facebook Inc for $1 billion in 2006. A 2002 dalliance with Google similarly came to naught. A chance to acquire YouTube came and went. Skype was snapped up by eBay Inc. And Microsoft Corp's nearly $45 billion takeover bid for all of Yahoo in 2008 was blocked by Yahoo's leadership. READ MORE...

ALSO: Yahoo has made its exit as an independent company — here's what happens next


JULY 25 -Yahoo CEO Marissa MayerReuters/Pascal Lauener
On Monday, Yahoo agreed to sell its core internet business to Verizon for $4.8 billion, putting an end to its 20-year history as a standalone company. The sale to Verizon drew nostalgic responses from Wall Street investors, including RBC Capital, which characterized the deal as an "ignominious end for Yahoo, which used to be the Facebook or Google of the internet circa 1999." But despite the death-knell-ringing headlines, Yahoo's tumultuous storyline is far from reaching its end. The company's internet products will continue to serve its billions of users, while its management still has a lot of work to do to figure out how to monetize its shares tied to Yahoo Japan and Alibaba, the crown jewels of Yahoo's remaining assets. Here's a rundown of what to expect from Yahoo moving forward: Yahoo's core products: Yahoo's core products will continue to exist under Verizon's ownership. It may shut down some portals and smaller properties, but Yahoo's focus on growing its search, mail, and various content verticals, like sports and finance, to create a bigger advertising platform will remain the same. "For Verizon, this combination should create a powerful rival to Google and Facebook in mobile media, and an open, scaled alternative offering for advertisers and publishers. The Verizon/AOL/Yahoo combination will have more than 25 brands in the portfolio," market research firm Cantor Fitzgerald wrote in a note. Yahoo's remaining assets: Once the Yahoo-Verizon deal is completed, Yahoo's remaining assets, largely comprising its stake in Alibaba and Yahoo Japan, will be owned by a renamed publicly traded company. Its ownership stake in those two companies is worth $40 billion, but expect it to trade at a slight discount given the complexity in cashing out its value. Yahoo Japan shares: The next logical step is for the remaining company, called Remain Co. for now, to find a way to monetize its Yahoo Japan stake. The most logical buyer would be Softbank, which already owns 43% of Yahoo Japan. But Softbank recently spent $32 billion to buy ARM, so a deal might be unlikely in the near term, according to SunTrust analyst Bob Peck. If it can't find a buyer, Remain Co. could cash out Yahoo Japan shares by issuing dividends or selling it in the open market, but tax issues and selling pressure could reduce its return, Peck says. READ MORE...

ALSO Yahoo Mail and Tumblr and Flickr: What Happens Now?


JULY 25 -Credit Brendan Mcdermid/Reuters
SAN FRANCISCO — Verizon’s announcement that it is acquiring Yahoo’s operations is a turning point for an internet pioneer that claims a billion users visit its services each month. In addition to Yahoo’s popular email service, Verizon is taking over content sites like Yahoo Sports and Yahoo News, as well as Yahoo-owned services that operate separately under their own brands, including the Tumblr social network and the Flickr photo-sharing service. Here are answers to some common questions about the impact of the deal. Q. What happens to my favorite Yahoo services now that Verizon is buying the company? A. Nothing for now. The deal is not expected to close until early next year, so for the moment, Yahoo is operating like it always has. After the deal closes, Verizon intends to keep Yahoo and its services as separate brands, according to Tim Armstrong, the chief executive of Verizon’s AOL unit. “Yahoo is one of the most powerful brands in the planet,” he said. “We will be investing in it.” Wait, AOL? Verizon owns AOL? So will my Yahoo email become AOL email? No, Yahoo Mail is one of the company’s most successful services and Verizon plans to keep it separate. What about other Yahoo services, like fantasy sports and Yahoo Finance? Mr. Armstrong said that the two companies have not yet sat down to work out all the transition plans, but the intention is to keep Yahoo’s content sites and apps. Will Verizon keep Yahoo search? Will I still see the Yahoo search box in my Firefox browser? The future of search is fuzzier. Yahoo’s current chief executive, Marissa Mayer, has invested heavily in search, but the company has continued to lose ground to Google. READ MORE...


READ FULL MEDIA REPORTS HERE:

Verizon buys Yahoo for $4.83B, marking end of an era
[
Yahoo will be rolled into Verizon’s AOL operations and CEO Marissa Mayer may be reunited with AOL]


In this Nov. 5, 2014, file photo, a person walks in front of a Yahoo sign at the company's headquarters in Sunnyvale, Calif. Yahoo reported Tuesday, April 19, 2016, that after subtracting ad commissions, Yahoo's revenue fell 18 percent from the same time a year earlier, to $859 million. It's the largest decline in Yahoo's quarterly net revenue since the company hired Marissa Mayer as its CEO nearly four years ago. (AP Photo/Marcio Jose Sanchez, File)

SAN FRANCISCO, AUGUST 1, 2016 (MANILA BULLETIN) July 25, 2016 By Michael Liedtke and Tali Arbel, AP Technology Writers — Verizon is buying Yahoo for $4.83 billion, marking the end of an era for a company that once defined the internet.

It is the second time in as many years that Verizon has snapped up the remnants of a fallen internet star as it broadens its digital reach. The nation’s largest wireless carrier paid $4.4 billion for AOL last year.

Yahoo will be rolled into Verizon’s AOL operations and CEO Marissa Mayer may be reunited with AOL CEO Tim Armstrong, who worked with her as executives at Google for years and tried unsuccessfully to convince her to combine the two companies when they both remained independent.

“We have enormous respect for what Yahoo has accomplished: this transaction is about unleashing Yahoo’s full potential,” Armstrong said in a statement.

Most analysts expect the deal to end the four-year reign of Yahoo’s Mayer, a former Google executive who flopped in her attempts to turn around the Sunnyvale, California, company.

Mayer, though, told employees in a Monday email that she intends to stay, though she didn’t say for how long. “I love Yahoo, and I believe in all of you. It’s important for me to see Yahoo into its next chapter,” she wrote.

Yahoo Inc., Sunnyvale, California, is parting with its email service and still-popular websites devoted to news, finance and sports in addition to its advertising tools under pressure from shareholders fed up with a steep downturn in the company’s revenue during the past eight years.

The slump has been deepening even though advertisers have been pouring more money into what is now a $160 billion market for digital advertising, according to research firm eMarketer.

READ MORE...

Most of the money has been flowing to internet search leader Google and internet social networking leader Facebook, two companies that eclipsed Yahoo during its slide from an online sensation, once valued at $130 billion, to a dysfunctional also ran.

After the sale is completed early next year, Yahoo will become a holding company for its two stakes in China’s e-commerce leader, Alibaba Group, and Yahoo Japan. Those investments, made more than a decade ago, are worth more than $40 billion before taxes, making them by far the most valuable pieces of Yahoo. The holding company will drop the Yahoo name and adopt a new identify after Verizon takes control of the operating business.

Yahoo also still has a patent portfolio that it intends to sell, and about $7.7 billion in cash. Verizon is buying Yahoo’s real estate, along with the online operations.

Yahoo has hired a succession of CEOs to engineer a comeback, but finally gave up after the high hopes that accompanied Mayer’s hiring fizzled out.


YAHOO CEO MARISSA MAYER

The sale potentially could result in thousands of layoffs. Mayer has already jettisoned 1,900 Yahoo workers since last September.

If Mayer leaves following the sale, she will be in line to receive a severance package valued at $55 million.

As people began to flock to the internet with the advent of graphical web browsers in the 1990s, Yahoo was king. After co-founders Jerry Yang and David Filo began building a web directory as Stanford University computer graduate students in 1994, Yahoo quickly established itself as the online hub for tens of millions of people. It also proved internet companies could be profitable as other dot-com startups burned through millions of dollars.

But Yahoo strayed from internet search in an attempt to build a multimedia business, opening the door for Google to become a powerhouse. It didn’t recognize the importance of social networking and was slow to make the leap into mobile devices like smartphones and tablets.

Instead, Yahoo tried to buy Google and Facebook in those companies’ formative years, but it was rebuffed and then dwarfed by them.

Mayer believes Yahoo can still come back now that it’s about to join a bigger company in Verizon. “Yahoo is a company that changed the world and will continue to do so,” she said during a Monday conference call with analysts.

Despite Yahoo’s troubles, its operations are attractive to Verizon because the wireless carrier is looking to capitalize on the growing number of people living their digital lives on smartphones. Verizon already profits from the data plans that connect more than 100 million people using those devices to the internet; with AOL and Yahoo’s services, Verizon is now looking to control more of the advertising experience on phones instead of surrendering control to Google and Facebook.

If Verizon fully owned Yahoo right now, it would generate about $3.6 billion in U.S. ad revenue this year to eclipse Microsoft for third place in the market, based on eMarketer’s estimates. It would still be far behind in ad revenue, compared with Google’s projected $27 billion, and Facebook’s projected $10 billion.

AOL is best known for the dial-up internet it popularized in the ’90s and owns popular media sites like Huffington Post and TechCrunch, but Verizon primarily wanted its ad technology.

While Verizon also wants Yahoo’s ad services, it is also prizes the hordes that still regularly visit to pick up their email, check the weather and catch up on current events, celebrity gossip and the stock market. The company is hoping to have a mobile audience of 2 billion people by 2020, with a goal of $20 billion in mobile revenue by that time.

Yahoo says it has more than 1 billion users, though Outsell analyst Randy Giusto believes only about 200 million are habitual visitors.

“It’s the eyeballs that generate the advertising, you have to get to that viewership to get the advertisers to advertise, and that’s the model that we have to follow,” said Verizon CFO Francis Shammo at an investment conference in May in response to a question about Yahoo’s appeal.

Given Verizon already owns AOL, Giusto says Verizon is probably the best fit for Yahoo instead of the other suitors, which also included private equity firms that specialize in buying distressed companies and trying to rehabilitate them.

The deal, expected to close within the first three months of next year, still needs approval from Yahoo shareholders.

Yahoo’s stock fell slightly at the open of trade Monday.


BUSINESSINSIDER.COM

Insiders explain the identity crisis that led to Yahoo's demise Reuters Jonathan Weber and Jeffrey Dastin, Reuters Jul. 26, 2016, 2:34 PM 7,358 1


Marissa Mayer said that she still saw a "path to growth" for Yahoo. Mario Tama/Getty Images

When senior Yahoo executives gathered at a San Jose hotel for a management retreat in the spring of 2006, there was no outward sign of a company in crisis.

The internet pioneer, not yet a teenager, had just finished the prior year with $1.9 billion in profits on $5.3 billion in revenue. The tough days of the dot-com bust were a distant memory, and Yahoo Inc, flush with lucrative advertising deals from the world's biggest brands, was enjoying its run as one of the top dogs in the world's hottest industry.

But for one retreat exercise, everyone was asked to say what word came to mind when a company name was mentioned. They went through the list: eBay: auctions. Google: search. Intel: microprocessors. Microsoft: Windows.

Then they were asked to write down their answer for Yahoo.

"It was all over the map," recalled Brad Garlinghouse, then a Yahoo senior vice president and now COO of payment settlement start-up Ripple Labs. "Some people said mail. Some people said news. Some people said search."

While some executives said this was a useful management exercise that took place multiple times over the years, it proved an ominous portent of the business troubles to come.

Indeed, the demise of Yahoo, which culminated in an agreement this week to sell the company's core assets to Verizon Communications Inc, has been more than a decade in the making. Many of the more than two dozen former Yahoo managers interviewed by Reuters over the past two weeks -- who now occupy executives suites elsewhere in Silicon Valley -- agree that the company's downfall can be traced to choices made by both the executive leadership and the board of directors during the company's heyday in the mid-2000s.

Some of the missed opportunities are obvious: a failed bid to buy Facebook Inc for $1 billion in 2006. A 2002 dalliance with Google similarly came to naught.

A chance to acquire YouTube came and went. Skype was snapped up by eBay Inc. And Microsoft Corp's nearly $45 billion takeover bid for all of Yahoo in 2008 was blocked by Yahoo's leadership.

READ MORE...

Just as damaging as the missed deals, though, was a company culture that ultimately became too bureaucratic and too focused on traditional brand advertising to prosper in a fast-moving tech business, according to some of the former Yahoo managers Reuters spoke with.


A combination photo of Yahoo logo in Rolle Switzerland and a Verizon sign in San Diego California Thomson Reuters

"It became very difficult to get both investment and alignment" around new product initiatives, said Greg Cohn, a former senior product director at Yahoo and now CEO of the mobile phone app company Burner. "If you built a new product and the home page didn't want to feature it, you were hosed."

Worst of all, once Alphabet Inc's Google had displaced it as peoples' first stop for finding something on the internet, Yahoo was never able to decide on exactly what it wanted to be.

Yahoo today has more than 1 billion users and has focused on mobile under chief executive Marissa Mayer, who told Reuters in an interview Monday that she still saw a "path to growth" for Yahoo, which the Verizon merger accelerated.

Yahoo will continue to operate as a holding company for its large stakes in Alibaba and Yahoo Japan, which are worth far more than the core business.

Yahoo declined to comment for this story.

THE PURPLE CARPET

The appointment of Terry Semel, who had completed a highly successful run as chairman of the Warner Bros. movie studio, as CEO in 2001 seemed to answer a question that bedeviled many early internet firms: was it a tech company, or a media company?

Semel could not be reached for comment on his Yahoo tenure. But the focus on media proved lucrative in the short term as big advertisers, desperate to get on board with the next big thing, flocked to one of the largest properties on the web. Revenue soared from $717 million in 2001 to nearly $7 billion by 2007.

Indeed, Semel and the media executives he brought in by all accounts turned a scrappy young internet startup into a highly profitable company that brought old-line advertising to a new medium.

"From our perspective, we were a media company," said Dan Rosensweig, Yahoo's COO from 2002 to 2007 and now CEO of online education company Chegg Inc. "It didn’t feel at the time that there was a strong likelihood we would beat Google at search... Nobody could argue that we weren’t the largest front page on the internet."


Terry Semel was appointed CEO in 2001. AP

Yahoo placed its signature purple everywhere then -- on cookies and cupcakes, on the carpets, and even in the martinis.

"When Coca Cola came to campus, we rolled out the purple carpet," recalled Wenda Harris Millard, Yahoo's chief sales officer from 2001 to 2007 and now president and COO of business development firm MediaLink.

Millard said all the major advertisers, from Coke to General Motors, wanted to come to Yahoo's campus at least once a year.

"We were just doing gazillions of dollars with them," said Millard.

THE MONEY TRAP

But the excitement, and the revenue, associated with the big advertising deals ten years ago turned out to be a trap in many ways. Like its brethren in the print media business, who continued to rely on selling ad pages long after it was clear that it was a dying business, Yahoo couldn't help but to focus on where the big money was, even though that wasn't where the future was.

"The worst consequence of trying to be a media company was that they didn't take programming seriously enough," wrote Paul Graham, co-founder of the Y-Combinator tech incubator who sold a startup to Yahoo, in a 2010 blog post about the company's woes. "Microsoft (back in the day), Google, and Facebook have all had hacker-centric cultures. But Yahoo treated programming as a commodity."

The downside of the media orientation became more clear as the 2000s wore on. In 2003, Yahoo acquired Overture, the company that essentially invented the ad-search technology that made Google rich. But Yahoo never succeeded in creating a strong competitor to Google's AdWords and AdSense systems.

A subsequent, hugely expensive effort to rebuild its search and advertising technology, dubbed Panama, similarly bore little fruit.


File photo of Yahoo CEO Marissa Mayer delivering her keynote address at the annual Consumer Electronics Show (CES) in Las Vegas Thomson Reuters

Meanwhile, market-leading products like Yahoo Mail, and early social media efforts like Yahoo Groups, were neglected as managers wrestled over which products would get priority on the hugely valuable Yahoo home page, according to three former executives. Promising acquisitions, including photo-sharing site Flickr and social bookmarking service Delicious, withered on the vine.

Former staffers say they were consumed with endless internal meetings and shifting priorities. Former senior product director Cohn recalls how efforts to make Yahoo an open platform -- with nifty third-party applications around specific content areas such as travel -- foundered in the face of opposition from managers in charge of Yahoo's in-house products.

Too often, the end result was money spread too thinly across too many marginal initiatives, as Garlinghouse famously pointed out in a leaked internal document known as the Peanut Butter Manifesto.

TURMOIL AT THE TOP

By 2007, it was becoming clear that Yahoo was losing ground fast on the product side as Google solidified its hold on search. New players like Facebook and Netflix Inc continued to arrive and steal Yahoo's thunder. Semel left that year in favor of co-founder Jerry Yang.

Whatever plans Yang may have had were quickly disrupted by the unsolicited Microsoft takeover bid in early 2008. The offer split the management team, Garlinghouse and others say, and those divisions persisted even after Microsoft's offer was beaten back.

Yang, who championed the resistance to Microsoft, stepped down again in 2008. Three other CEOs followed before Mayer was appointed in 2014.

The leadership turmoil "made for a difficult existence for a board, a management team, and a general employee population to get committed to the same goal," said Rosensweig.

Yang did not respond to requests for comment.

By the time Mayer arrived, Yahoo was already seen in Silicon Valley as a company from another era. It had lots of cash but few strategic advantages as it fought far larger competitors. Many analysts and shareholder say Mayer exacerbated the troubles with acquisitions and key hires that proved misguided.

Mayer put a brave face on the deal Monday, saying the scale that will result from the Verizon combination will enable it to continue its efforts to catch up in mobile, social and advertising technology. But the history of the tech business, where companies rarely dominate from one generation to the next, suggests that any such revival is a tall order.


BUSINESS INSIDER ONLINE

Yahoo has made its exit as an independent company — here's what happens next
Eugene Kim Jul. 25, 2016, 4:30 PM 6,697 8


Yahoo CEO Marissa MayerReuters/Pascal Lauener

On Monday, Yahoo agreed to sell its core internet business to Verizon for $4.8 billion, putting an end to its 20-year history as a standalone company.

The sale to Verizon drew nostalgic responses from Wall Street investors, including RBC Capital, which characterized the deal as an "ignominious end for Yahoo, which used to be the Facebook or Google of the internet circa 1999."

But despite the death-knell-ringing headlines, Yahoo's tumultuous storyline is far from reaching its end.

The company's internet products will continue to serve its billions of users, while its management still has a lot of work to do to figure out how to monetize its shares tied to Yahoo Japan and Alibaba, the crown jewels of Yahoo's remaining assets.

Here's a rundown of what to expect from Yahoo moving forward:

Yahoo's core products: Yahoo's core products will continue to exist under Verizon's ownership. It may shut down some portals and smaller properties, but Yahoo's focus on growing its search, mail, and various content verticals, like sports and finance, to create a bigger advertising platform will remain the same.

"For Verizon, this combination should create a powerful rival to Google and Facebook in mobile media, and an open, scaled alternative offering for advertisers and publishers. The Verizon/AOL/Yahoo combination will have more than 25 brands in the portfolio," market research firm Cantor Fitzgerald wrote in a note.

Yahoo's remaining assets: Once the Yahoo-Verizon deal is completed, Yahoo's remaining assets, largely comprising its stake in Alibaba and Yahoo Japan, will be owned by a renamed publicly traded company. Its ownership stake in those two companies is worth $40 billion, but expect it to trade at a slight discount given the complexity in cashing out its value.

Yahoo Japan shares: The next logical step is for the remaining company, called Remain Co. for now, to find a way to monetize its Yahoo Japan stake. The most logical buyer would be Softbank, which already owns 43% of Yahoo Japan. But Softbank recently spent $32 billion to buy ARM, so a deal might be unlikely in the near term, according to SunTrust analyst Bob Peck.

If it can't find a buyer, Remain Co. could cash out Yahoo Japan shares by issuing dividends or selling it in the open market, but tax issues and selling pressure could reduce its return, Peck says.

READ MORE...

Alibaba assets: Once Remain Co. separates all Yahoo Japan shares and is left with only Alibaba shares, it could be sold to another company without incurring any taxes for Yahoo, according to Peck. The most likely buyer would be Alibaba.

The problem is Remain Co. — then basically an Alibaba subsidiary holding its own shares — could be treated as a "hook stock" that entitles the company to getting taxed twice.

Yahoo's management also indicated on Monday that Remain Co. plans to hold on to its Alibaba shares "indefinitely" until it finds a way to sell it in a tax-free way.

Leadership: Yahoo's core under Verizon will be led by AOL CEO Tim Armstrong. It's unclear what role Yahoo CEO Marissa Mayer will play, although she said she plans to stay with the company.

For Remain Co., it's unclear how it will be managed. Since it's simply a holding company, it won't need much day-to-day operations help, but it will need a final decision-maker on any transactions. It is assumed that Yahoo's current board will make those decisions, in which case, Mayer, who's on the board, will continue to be part of it.

Financials: Verizon stopped disclosing AOL's financials post-acquisition, so it's likely that Yahoo will also stop reporting its numbers every quarter once the deal is complete.

Workforce: Yahoo's in the middle of a 15% workforce reduction plan that will lay off roughly 1,600 people by the end of the year. But Mayer said she could revisit the layoff plan "through the strategic alternative process," and given that Yahoo has a new owner, it could announce additional job cuts after the deal is complete.

Peck estimates that Yahoo could cut an additional 40% of its workforce under Verizon to cut all the overlapping positions, especially in sales and general operational jobs, which would help save almost $2 billion.

SEE ALSO: VERIZON WILL ACQUIRE YAHOO FOR $4.8 BILLION

NOW WATCH: Katie Couric reveals what it's like to work with Marissa Mayer at Yahoo


NEW YORK TIMES

Yahoo Mail and Tumblr and Flickr: What Happens Now? By VINDU GOELJULY 25, 2016


Credit Brendan Mcdermid/Reuters

SAN FRANCISCO — Verizon’s announcement that it is acquiring Yahoo’s operations is a turning point for an internet pioneer that claims a billion users visit its services each month.

In addition to Yahoo’s popular email service, Verizon is taking over content sites like Yahoo Sports and Yahoo News, as well as Yahoo-owned services that operate separately under their own brands, including the Tumblr social network and the Flickr photo-sharing service.

Here are answers to some common questions about the impact of the deal.

Q. What happens to my favorite Yahoo services now that Verizon is buying the company?

A. Nothing for now. The deal is not expected to close until early next year, so for the moment, Yahoo is operating like it always has.

After the deal closes, Verizon intends to keep Yahoo and its services as separate brands, according to Tim Armstrong, the chief executive of Verizon’s AOL unit. “Yahoo is one of the most powerful brands in the planet,” he said. “We will be investing in it.”

Wait, AOL? Verizon owns AOL? So will my Yahoo email become AOL email?

No, Yahoo Mail is one of the company’s most successful services and Verizon plans to keep it separate.

What about other Yahoo services, like fantasy sports and Yahoo Finance?

Mr. Armstrong said that the two companies have not yet sat down to work out all the transition plans, but the intention is to keep Yahoo’s content sites and apps.

Will Verizon keep Yahoo search? Will I still see the Yahoo search box in my Firefox browser?

The future of search is fuzzier. Yahoo’s current chief executive, Marissa Mayer, has invested heavily in search, but the company has continued to lose ground to Google.

READ MORE...

Mr. Armstrong was noncommittal on search, saying that would be a topic of discussion between the two companies. “Yahoo has products that have not launched yet on search,” he said, and Verizon wants to evaluate those.

Under Yahoo’s search partnership with Mozilla, the maker of the Firefox web browser, anyone who buys Yahoo must offer a search product through the end of 2019 or pay a hefty breakup fee.

What about my personal data?

Will Verizon share data about my cellphone use to Yahoo’s advertisers and will Yahoo use what it knows about my web surfing to sell ads on my phone?

The Federal Communications Commission fined Verizon in March for tracking people’s cellphone browsing habits without their consent. Now the company is banned from sharing data across its business units unless it gets the user’s permission.

But the F.C.C. is considering broader rules to govern such data sharing, and Verizon is one of several companies lobbying to loosen the restrictions.


Chief News Editor: Sol Jose Vanzi
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