Verizon is done trying to become something it’s not, selling off its media group that includes AOL and Yahoo while there’s still some value.
The sale, to Apollo Global Management, allows Verizon to retain a 10% stake in the properties – now to be called only “Yahoo” — and brings a $5 billion price tag.
The bet on two of the bigger names of the internet era did not pay off.
Verizon paid $4.4 billion for AOL in 2015 and $4.5 billion for Yahoo in 2017.
The online media brands under the Yahoo and AOL names include TechCrunch, Yahoo Finance and Engadget.
Verizon already had sold HuffPost (to BuzzFeed) and purged media properties including Tumblr and Yahoo Answers.
Like most companies trying to battle Facebook and Google for a bigger slice of the online ad pie, Verizon fell short.
Now, the communications company will channel its energies to internet provider businesses and its wireless networks, with the new revenue likely helping with the Verizon’s buildout of its 5G network.
Verizon will let its direct competitors take on Netflix and Disney.
AT&T (via WarnerMedia) and Comcast (NBCUniversal) continue to pursue their version of streaming services.
“Verizon Media has done an incredible job turning the business around over the past two and a half years and the growth potential is enormous,” Verizon Chief Executive Hans Vestberg said in a release.
The Verizon media business made up only 6% of its revenue in the latest quarter.
Verizon’s stock was down 1.6% year to date through Friday.
Apollo, meanwhile, is bullish on its acquisitions.
“We are big believers in the growth prospects of Yahoo and the macro tailwinds driving growth in digital media, advertising technology and consumer internet platforms,” said David Sambur, a senior partner at Apollo, in a press release.