Verizon and AOL Shift Strategy

It looks as if  the phone company formerly known as Verizon is taking some steps to bring itself into the digital world in more than name only.

Verizon is the fifth largest ad spender in the US, and controls about a quarter of the wireless industry’s total spend. Most of its spending is on traditional TV,  however,  over on the ZEDO blog we discussed its use of augmented reality in ads for its phone service. The carrier commissioned the building of a cellular network within the game of Minecraft, which allowed players to make phone calls from within the game. And now Verizon’s AOL media platform is experimenting with new video ad formats for 2017.

On Thursday at CES AOL rolled out several non-intrusive formats in line with the IAB’s L.E.A.N. standards for combatting the rash of ad blocker downloads that have characterized the past few years.  One of them is an alternative to pre-roll, which  is simultaneously one of the most coveted ad buys in digital video, and one of the most hated formats by consumers. Traditional pre-roll holds the viewer back from the video for 15, 30, or 60 seconds and measures in terms of completions. But AOL’s new PlayerUp 

is a suite of consumer friendly ad experiences that provide an alternative to preroll and consists of 3 primary ad experiences: 1. Bumper – Short 3-7 second, non-disruptive preroll video that sets the stage before quickly transitioning to the publisher video content 2. Watermark – Consumer-friendly experience offering advertisers the opportunity to extend their brand’s exposure beyond preroll by displaying an interactive overlay during playback of publisher video content. The Watermark unit can also be interactive and may expand upon click/tap to reveal a suite of interactive content while pausing the underlying publisher content. Upon closing the expanded Watermark, publisher content resumes playback 3. Pause – Advertisers have the option to incorporate subtle brand messaging each time the publisher video content is paused by the consumer.

In addition, Verizon has not said it will withdraw from its deal to buy Yahoo, although it has commented that it will try to get a better price on the deal. Yahoo still has a billion monthly users, and in is effort to become a digital media player, both Yahoo’s technology and Yahoo’s customers could be instrumental. And last summer, Verizon bought Complex Media in partnership with Hearst. Complex Media owns properties that can deliver millennial men to Verizon’s other businesses.

So Verizon is positioning itself for the shift to digital advertising, the commoditization of data pipes, and the slowing growth in cell phones by becoming a platform that can produce a large audience and some interesting ad formats to serve that audience.