AOL's Tim and Arianna Now Work for the Phone Company

At some point in the future, if it all works out as AOL CEO Tim Armstrong grandly envisions his deal to be acquired by Verizon for $4.4 billion in cash, I will gladly admit I am wrong. But right now, despite all the talk about the glorious mashing together of content and technology, the details seem somewhat squishy.

Consider this sentence from the internal memo that Armstrong sent out to assuage his sure-to-be nervous troops:

“The company is Verizon and the deal will game-change the size and scale of AOL’s opportunity. Just as AOL has propelled The Huffington Post, Adap.tv, TechCrunch, and other companies we have acquired, Verizon will propel AOL and comes to the table with over 100 million mobile consumers, content deals with the likes of the NFL, and a meaningful strategy in mobile video.”

Leaving aside the fact that game-change is not a verb in any way, it is unclear what this actually means in practice. Does it suggest that the moneybags phone company will hand over tons of cash to expand willy-nilly AOL’s harder-to-monetize content properties? Or does it mean that Huffington Post’s major domo Arianna Huffington will suddenly appear on the screen of my Apple iPhone Plus urging me to go to sleep in a snackable smartphone video? Or that Verizon will suddenly turn all Netflix and start funding online shows like “Game of Phones”?

Or perhaps it is just a lot of pretty words to dress up the real heart of this deal — that Armstrong has assembled a nice group of advertising technology companies that are attractive to Verizon as a new growth business as its users move their media consumption to their mobile devices. You can’t let Google suck in all the mobile ad dollars, right?

Armstrong certainly could not say “media technology” — read ad tech on mobile — too many times in his memo, even as he made as many mobile puns as possible.

“We have the opportunity to build a unique and globally scaled media technology company with the scale and resources we need to make that happen,” wrote Armstrong. “AOL is back and now we are joining forces with Verizon to build the best media technology company in the world. Let’s mobilize.”

Get it? Mobilize!

But what Armstrong is not saying is that he had very few options to try to turbocharge his stitched-together businesses. Yahoo’s Marissa Mayer wasn’t biting. The prospect of raising more capital — which was also mulled — has its challenges. And, more to the point, AOL has been operating in the land of the giants, with competitors like Facebook, Google, Apple and others moving squarely to dominate the so-called media technology landscape.

It’s interesting to ponder why there seemed to be no other bidders here for AOL, even after the rumors of Verizon’s interest surfaced months ago. Some shareholders called me today to express surprise at the all-cash deal at a small premium to AOL’s market valuation and also the speed at which the deal is closing. In its press release today, the companies said the transaction “will take the form of a tender offer” and close this summer, probably within 60 days.

That’s fast, which suggests that Armstrong wanted to make hay while the sun is still shining. Despite all the clever zigs and zags he made over the five years after he spun AOL out of Time Warner — from the purchases of Huffington Post and TechCrunch (we love content!) to the dough forked over to its ill-conceived Patch effort (we love local!) to the idea that AOL was going to revive its MapQuest property (we love mapping!) — what’s made traction has largely been the ad and video tech properties.

And while Armstrong can say until he is blue in the face that content is key, it’s more about helping and profiting from content companies needing to have a mobile ad offering. That’s why he has been in talks with big media giants like Axel Springer and others to invest in as a joint venture or even buy the Huffington Post for months now, despite protestations that AOL never would do such a thing.

It would and probably will, which leaves only the question: How long will Armstrong himself last inside the telecom giant that has just swallowed him whole? While there has been some speculation that he is gunning for a bigger job within Verizon, I have to be dubious again, although I am happy to be proven wrong.

But the idea of Tim and Arianna working at the phone company? Well, as Armstrong is fond of saying: Stay tuned.

This article originally appeared on Recode.net.

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