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You’ve got sale: AOL sold to Verizon

  • Published on May 12, 2015
You’ve got sale: AOL sold to Verizon

Telecommunication giant and Internet service provider Verizon announced that they are buying AOL for a whopping $4.4 billion. While a staggering sum for AOL, this is less than 5% of the price AOL paid for Time Warner back in 2000. For those who remember the early days of the Internet, AOL was a pioneer in connecting computers to news and information. Long before the widespread use of web browsers, HTML, and ubiquitous broadband, AOL provided a way for most people to connect to the Internet. In AOL’s early days, useful content was sparse, so they provided content. Similarly, search engines were sparsely used, and AOL curated and surfaced content. If you wanted to create content to put online and actually be seen, instead of taking an HTML course or WordPress class, and putting your own site online, many business would set-up shop right on AOLs private network.

AOL was an early version of companies such as Verizon, Google and Huffington Post all rolled up into one. In AOL’s early days, direct Internet connectivity to the home or office rarely existed, dial-up connectivity was the most common method to connect. When a person wanted to connect to the Internet, they would use a modem at their home or office and dial into another modem managed by AOL. Once connected, users could access the AOL curated and managed content. Later, AOL added an early version of the web browser, making it possible for users to go outside the AOL network and browse the Internet.

AOL wanted more content, and Time Warner saw AOL as a new way to distribute their material online. AOL purchased Time Warner for $164 Billion some 15 years ago. Shortly after this, direct connections to the Internet became more common, less expensive, and provided a higher rate of speed. Search engines made it easier to find content, and new media firms appeared that made it less necessary to rely on traditional media. Web developers could learn HTML and set-up complex data-driven sites using WordPress, Drupal, or other tools. This shift is one of the reasons the AOL – Time deal never materialized, and AOL was once again turned into a separate company and AOL lost its importance for end-users.

As a media firm, AOL had developed some of the first technology for serving online advertisements. This time, it appears that the online advertising business is likely driving Verizon’s interest in AOL. While designers may focus on creating ads using Photoshop and Illustrator, or video ads with Premiere, After Effects, and Final Cut – the technology from AOL is what delivers these ads to many users.

About the author

Christopher Smith is president of American Graphics Institute in Boston, Massachusetts. He is the publisher and editor of the Digital Classroom book series, which have sold more than one million copies. At American Graphics Institute, he provides strategic technology consulting to marketing professionals, publishers and to large technology companies including Google, Apple, Microsoft, and HP. An expert on web analytics and digital marketing, he delivers Google Analytics training along with workshops on digital marketing topics. He is also the author of more than 10 books on electronic publishing tools and technologies, including the Adobe Creative Cloud for Dummies. Christopher did his undergraduate studies the at the University of Minnesota, and then worked for Quark, Inc. prior to joining American Graphics Institute where he has worked for 20 years.