Video Briefing: Oath’s future inside Verizon is cloudy
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The biggest question surrounding Oath has been what happens to the company — formed by Verizon following a $9 billion merger between AOL and Yahoo — now that Verizon seems to be scaling back on its media ambitions.
But with Oath CEO Tim Armstrong reportedly negotiating his exit from the company, the more immediate concern might be what happens with Oath’s platforms business, which houses the company’s various advertising and tech services.
THE KEY HITS:
- Oath CEO Tim Armstrong is reportedly on his way out of the company.
- Earlier this year, Oath hired former Alibaba exec K. Guru Gowrappan as its COO, around the same time it began a shift toward its publishing properties.
- Sources said this shift has come at the expense of Oath’s platforms business.
- This has become even more pronounced this summer as Gowrappan took over day-to-day control of Oath, prompting rumors that Armstrong was on his way out.
- Hanging over all of this is whether or not Verizon will remain committed to Oath under a new CEO who has signaled that he’s not interested in growing a media business.
In April, Gowrappan was named president and COO of Oath; he was pitched as Armstrong’s number two who would take on operational responsibilities as Armstrong focused on “strategic Oath opportunities and Verizon,” Armstrong said.
Around that time, with the eventual shut down of Verizon’s expensive mobile video bet Go90 looming, Oath began to shift its priorities to its publishing properties, which include HuffPost, Yahoo Finance, Yahoo Sports and other sites, sources said. (When Go90 shut down, Verizon made a point in its official statement to say that it will focus on “building its digital-first brands at scale in sports, finance, news and entertainment for today’s mobile consumers and tomorrow’s 5G applications”).
With products such as One by AOL, BrightRoll and Yahoo Gemini, Oath is also a prominent vendor in digital media. Oath even recently announced that it had consolidated its various ad tech products and services into one group called Oath Ad Platforms.
But sources told me that the focus on building out Oath’s publishing properties has come at the expense of the products and services in Oath’s platform business. With Gowrappan now running the show and leading direction on Oath’s media strategy, Oath is directing more attention and resources toward its publishing businesses than its platform businesses, sources said.
To be clear, there is no indication that Oath plans to shut down its platform businesses; it’s just become second fiddle, a “multi-billion dollar and profitable” afterthought, as one source said.
It’s also important to note that Armstrong, when he was CEO of AOL, played a big hand in building the current version of the Oath platform business. A lot of the products in the portfolio were built or acquired by AOL.
Hanging over all this are Verizon’s own media ambitions — or lack thereof following the appointment of new Verizon CEO Hans Vestberg, who doesn’t seem to share previous Verizon CEO Lowell McAdam’s interest in building a big media business. This wasn’t helped by the fact that Verizon took a huge loss on Go90, which was moved under Oath’s organization until it was finally laid to rest earlier this summer.
What does this mean for Oath? Sources said they expect the focus to remain on the publishing properties but weren’t able to give a confident answer on the rest of the business. Stay tuned.
“Shari [Redstone] will try to put the two companies back together even if she has to wait two years.” — TV network exec on the future of CBS and Viacom.
Numbers don’t lie
$5 million: Expected gross sales on Complex Media’s “Hot Ones”-themed hot sauces in 2018, according to the company.
$2.30: CPMs for Facebook Stories ads, according to flight-booking service Hopper, which paid around a $5 CPM for the same ads running in Instagram Stories.
What we’ve covered
How Complex, Bleacher Report and others use talent to build content franchises:
- Talent is beginning to play a central role in how content franchises get built and monetized through advertising, licensing, merchandise and live events.
- Otter Media-owned Rooster Teeth, for instance, has sold more than 26,000 T-shirts for just one of its many collections since 2016.
Read more about the role of talent in building franchises here.
Facebook is giving advertisers more visibility on ads:
- Advertisers can now see where their ads might appear on in-stream videos, including those in Watch and Instant Articles.
- Advertisers will also be able to blacklist publishers — but some are calling on Facebook to enable whitelists.
Read more about Facebook advertising here.
What we’re reading
Who wants to be the next CEO of CBS?: Former Turner CEO John Martin and new CBS board member Richard Parsons are two early outside candidates for the top job at CBS, according to Variety, which reports that Martin has met with Shari Redstone, head of National Amusements, which owns a controlling stake in CBS, sometime in the last six weeks. Other early frontrunners include CBS interim CEO Joseph Ianniello and Showtime CEO David Nevins.
Next year’s VidCon — the 10th ever — will not coincide with Cannes Lions: I don’t think there ever was much overlap between those who went to the Riviera for boozy yachts and those who went to Anaheim for the gathering of online video stars and their loud fans. But if VidCon wants to attract more marketers, then moving the show to a different week makes sense.
How Netflix took over stand-up comedy: This is a profile of the Netflix execs that helped turn the streaming giant into a stand-up powerhouse. Chris Rock, Dave Chappelle and Jerry Seinfeld have all done specials for Netflix by now. Hannah Gadsby’s acclaimed special “Nanette” is on the platform. According to Netflix, half of its 130 million global subscribers have watched a comedy special in the last year.
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