AOL: Here are 5 reasons selling to Verizon makes sense

Tim ArmstrongREUTERS/Jim UrquhartCEO of AOL Tim Armstrong attends the Allen & Co Media Conference in Sun Valley, Idaho July 12, 2012.

Verizon is planning to buy AOL for $US4.4 billion.

AOL CEO Tim Armstrong had long been rumoured to be trying to sell his company, but the news still comes as a surprise.

The deal is a bit confounding since AOL is an advertising technology company with a few strong media properties like Huffington Post and TechCrunch. Verizon is a wireless carrier, with a small business in fibre TV.

So why did Verizon want AOL? Here, per AOL, are 5 reasons this deal makes sense. The last point is the most important:

1. The combination of Verizon and AOL brings us to the scale of Facebook and Google: Verizon touches 70% of Internet traffic across 1.5 billion PCs, TVs and mobile devices.

2. The combination of Verizon and AOL creates a powerful force in mobile, video, social, and programmatic platforms.

3. Verizon leads in mobile & mobile video, and AOL leads in video & programmatic advertising. The combination creates the first & most powerful media technology company on the planet.

4. The bundling of Verizon and AOL creates a powerful platform for the unbundling of media.

5. AOL shareholders have more than doubled their investment value (~150%) during AOL’s turnaround, and now Verizon and AOL will double the size of the mobile video/TV ad market.

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