Verizon’s $4.4 billion AOL purchase – its all about mobile and video

Its a lesson that all online businesses should heed.

In an interview on CNBC’s Squawk Box just minutes after the deal was announced, AOL, Inc. (NYSE:AOL) Chairman and CEO Tim Armstrong explained that the key to a hookup with Verizon – and the reason to do it now – is the increasing importance of video, mobile, and of course the combination of video-on-mobile.

AOL owns a number of leading online content brands such as Huffington Post, with approximately 200 million monthly consumers of its premium brands. But as consumers are changing the way that they engage with content – seeing it more and more via mobile devices – forcing the business model for content company to change with it, AOL believes that it needs to produce a lot more (friendly-for-mobile) video content. And, it needs to increase access to its content on mobile devices.

mobile videoHence, the hookup with Verizon Communications Inc. (NYSE:VZ), one of the largest wireless and wireline ‘pipe’ companies in the US.

At the other end of the deal, whether or not ‘pipe’ companies such as Verizon should own their own content will continue to be debated. But as their premium business is increasingly mobile, this is where they looked.

The lesson, of course, for those in online industries such as Forex trading is that the way we engage with clients is changing. Brokers need to make more use of video, and create more mobile friendly content.

Those following LeapRate will have noticed the increased video content we post – everything from our daily LeapRate TV segment summarizing the day’s FX industry news, to video interviews and talk shows with leading industry figures. Expect even more going forward.

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