Verizon tipped to buy Yahoo! for US$5bn

Carrier becoming the place where 90s media empires go to be recycled into targeted ads

Markets are bracing for a Monday puzzle: why on earth does Verizon think it is worth spending US$5bn on Yahoo!?

Financial news outlets are alive with people-familiar-with-discussions-fed reports that Verizon and Yahoo! have stopped flirting with anybody else and will soon announce that each has a nice new toothbrush in the other's bathroom.

What to make of the deal, if it happens? Remember, dear readers, that Verizon last year bought AOL for $4.4bn and then changed its privacy policy in order to “make the ads you see more valuable across the different devices and services you use."

Yahoo! offers Verizon another source of data it can use to sell even more “valuable ads”. The carrier is hardly alone in that effort: firms like Wayin boast they'll soon have data on one in seven humans, with such troves considered fabulous sources of data for identity theft.

A formal announcement on the deal is expected on Monday, US time.

It's widely expected that Yahoo!'s board will accept any offer with a five in front of it, as to do otherwise would be to deliver even more pain to shareholders.

Verizon investors might also wonder how enjoyable it will be to own two 90s online media stars that now have little or no growth prospects, after decades of carriers' efforts to do more than shovel bits were beaten time and again by over-the-top players.

Perhaps Verizon's very special brand of maths will help out: last week the carrier told customers who consume more than 100GB of mobile data on “unlimited” contracts that it would force them to adopt different plans. Customers who don't make the jump will be kicked off the network. ®


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