Verizon to Cut 2,100 Jobs at Yahoo

Part of Verizon’s plan to combine Yahoo and AOL in order to get a huge digital advertising offensive is to cut about 2,100 jobs. On Thursday, the Yahoo shareholders approved to sell the business for $4.5 billion to Verizon. By Tuesday, the deal will be closed. However, according to an unnamed source, Yahoo and AOL are planning to cut 15% of the 14,000 employees they are currently hiring. This means that about 2,100 jobs will cease to exist in the near future.

Verizon’s ambitious plan

Verizon has a simple, yet very ambitious plan. By buying Yahoo and its core business, the company wants to become a great rival of giants like Google and Facebook, especially when it comes to the digital advertising branch. However, there might be a problem. There are many other new companies that are also looking to get a taste of the business. So, in order to become a preferable choice for advertisers, Verizon wants to combine Yahoo’s websites and billions of users with its own media business. This includes AOL and the video service called go90. The company can then put ads on those websites. It can also combine the data from the visitors with AOL’s own technologies and even sales teams. Moreover, Verizon might want to even use the personal data from its own customers, like location for example, and use it in order to get better targeted ads.

At the same time, analysts are saying that Yahoo and AOL will surely do better together than apart. However, their opinion is that if the business will not decline after this deal, they should consider it a success. As for growth from the deal, the prospects are not good.

Trying to become relevant as Oath

This ambitious ad business would be a blessing for Verizon, if it goes well. As the company basically became a no-growth business, it really needs to find solutions, and quickly. Tim Armstrong, the former Google executive who became AOL’s CEO back in 2009 said that he had this plan of combining AOL with yah for years. It just never came to be, until now. This combination of businesses will bear the name Oath and will see an expanding in the news, sports, entertainment, lifestyle and many other coverages.

Image source: flickr

 

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