Verizon Again Doubles Down On Yahoo After 6 Years Of Failure

from the telecoms-can't-innovate dept

You might recall that Verizon's attempt to pivot from grumpy old telco to sexy new Millennial ad brand hasn't been going so well. Oddly, mashing together two failing 90s brands in AOL and Yahoo, and renaming the coagulated entity "Oath," didn't really impress many people. The massive Yahoo hack, a controversy surrounding Verizon snoopvertising, and the face plant by the company's aggressively hyped Go90 streaming service (Verizon's attempts to make video inroads with Millennials) didn't really help.

By late 2018 Verizon was forced to acknowledge that its Oath entity was effectively worthless. By 2019, Verizon wound up selling Tumblr to WordPress owner Automattic at a massive loss after a rocky ownership stretch. Throughout all of this, Verizon has consistently pretended that this was all part of some amazing, master plan.

Those claims surfaced again this week with Verizon announcing that the company would be doubling and tripling down on the Yahoo experiment. For one, the company is launching Yahoo Shops, "a new marketplace destination featuring a curated, native shopping experience tailored to the user including innovative tech, from shoppable video to 3D try-ons, and more." It's also shifting its business model to focus more on subscriptions through Yahoo Plus, hoping to add on to the 3 million people that, for some reason, subscribe to products like Yahoo Fantasy and Yahoo Finance.

Again though, all of this sounds very much like unsurprising and belated efforts to mimic products and services that already exist. While surely somebody somewhere finds these efforts enticing, that this is the end result of its $4.48 billion Yahoo acquisition in 2017, and its 2015 $4.4 billion acquisition of AOL is just kind of...meh. It's in no way clear how Verizon intends to differentiate itself in the market, and people who cover telecom and media for a living continue to find Verizon's persistence both adorable and amusing:

Again, as companies that have spent the better part of a generation as government-pampered, natural monopolies, creativity, competition, innovation, and adaptation are alien constructs. Both AT&T and Verizon have thrown around countless billions at trying to become disruptive players in new media and advertising, and the end result has been nothing but a parade of stumbles. In fact AT&T's probably been a better poster child for this than even Verizon, given it spent $200 billion on megamergers only to lose around 8 million TV subscribers in just a few years. Growth for growth's sake isn't a real strategy.

The ultimate irony is that both companies even managed to successfully convince regulators at the FCC to effectively self-immolate, and even that couldn't buy either company the success they crave believe they're owed. Neither did the billions in money gleaned from the Trump tax cuts, which resulted in more layoffs than innovation. There are oodles of lessons here for those looking to learn from them, but absolutely no indication that's actually going to ever happen.

Filed Under: content, media, websites, yahoo
Companies: verizon, yahoo

Verizon's Oath Will Still Scan Your E-mail For Advertising Purposes Because Hey, It's Verizon

from the Verizon-gonna-Verizon dept

While all major webmail companies have veered away from the idea of automatically scanning private e-mails in a bid to monetize the content for behavioral advertising due to public backlash, that's simply not how Verizon rolls. According to a deep dive over at the Wall Street Journal (watch out for the paywall, here's a Verizon-owned Techcrunch alternative), Verizon and its Oath subsidiary now offer the country's only major webmail service that still thinks this practice is a good idea:

"Yahoo’s owner, the Oath unit of Verizon Communications, has been pitching a service to advertisers that analyzes more than 200 million Yahoo Mail inboxes and the rich user data they contain, searching for clues about what products those users might buy, said people who have attended Oath’s presentations as well as current and former employees of the company."

After backlash, Google ended its own practice of auto-monetizing e-mail content for behavioral ads last year, acknowledging that the practice doesn't exactly instill trust in your customers (e-mails are still automatically scanned as part of the company's "Smart Compose" feature, but content is no longer monetized). Apple has never scanned subscriber e-mails for this purpose, and Microsoft told Techcrunch this week that the company does “not use email content for ad targeting in any way, anywhere in Microsoft." The shift has been part of an effort to compete on privacy, which is an idea that should be encouraged.

Coming from the telecom sector, Verizon's not quite as familiar with this whole competition thing. In comments to the Journal, Oath's vice president of data, measurements and insights provided a very Verizon-esque response, suggesting the scanning was a public benefit to users eager to see more relevant ads:

"Mr. Sharp said that being served ads is part of the trade-off users make in exchange for free online services, and that Yahoo’s research shows they prefer ads that are relevant to them.

"Email is an expensive system,” Mr. Sharp said. "I think it’s reasonable and ethical to expect the value exchange, if you’ve got this mail service and there is advertising going on."

Yes, so ethical.

On the plus side, Verizon's e-mail scanning doesn't include health and medical information, though in the wild west of consumer privacy oversight that is the United States, you'd have a hard time confirming that this or other information (like financial data) isn't being exploited. After all, Verizon doesn't exactly have a great track record about being candid about this sort of thing. That said, it looks like even before Verizon came on board Yahoo's e-mail scanning and monetization system went notably further than Google's ever did:

"Initially, Yahoo mined users’ emails in part to discover products they bought through receipts from e-commerce companies such as Amazon.com Inc., people familiar with the practice said. Yahoo salespeople told potential advertisers that about one-third of Yahoo Mail users were active Amazon customers, one of the people said. In 2015, Amazon stopped including full itemized receipts in the emails it sends customers, partly because the company didn’t want Yahoo and others gathering that data for their own use, someone familiar with the matter said."

The problem is that while Verizon has hungrily eyed Silicon Valley giants' ad revenues for years, its effort to pivot into the ad sector isn't going so well. The company's Go90 video platform, purported to be the cornerstone of Verizon's Millennial-focused video ad ambitions, recently imploded after a fairly severe lack of public interest. And while Oath may ultimately prove to be a powerhouse in advertising, refusing to bend to competitive trends and consumer concerns by scanning the e-mails of millions of subscribers for an extra buck isn't a great way to build a trustworthy brand.

Of course, anybody surprised that Verizon would take the low road shouldn't be. After all, this is the same company that was caught a few years ago covertly modifying user wireless packets so it could track users around the internet without telling them. It took two years for security researchers to even notice it, and months more before Verizon could be bothered to offer a working opt out tool. And while the company was ultimately fined by the FCC for the practice, a bigger variant of that technology has long-since been implemented across Verizon's entire Oath (the combination of Yahoo and AOL) ad network.

Of course we haven't even gotten to Verizon's ultra-cozy relationship with the nation's intelligence apparatus yet, or the fact that giant ISPs routinely engage in pretty sleazy behavior to undermine pretty much any effort to shore up the nation's privacy standards, regardless of the quality of the effort. All while hoovering up and monetizing private user browsing and location data on a scale that pretty routinely makes the Facebook, Cambridge scandal look like child's play.

Granted if Verizon wants to undermine its own efforts to pivot into the online ad space that's its prerogative, but it might make sense for the traditionally myopic telecom giant to try and evolve on the consumer trust front as well. As an aside, if you're a Yahoo e-mail customer, you should be able to opt out here.

Filed Under: email, privacy, scanning, yahoo, yahoo mail
Companies: oath, verizon, yahoo

Italian Court Realizes That Yahoo Isn't Liable For Infringing Works Found Via Its Search Engine

from the secondary-liability dept

Qûr Tharkasdóttir alerts us to the news that an earlier court ruling in Italy, that placed liability on Yahoo for not magically knowing how to block all links that might lead to certain infringing material, has been overturned. Apparently, the higher court realized that applying such third party liability was crazy (Google translation from the original Italian. The translation is a bit funky, but it seems clear that the court recognized the basic problems of telling Yahoo it must automatically block all links that might lead to infringing movies based solely on the title of that movie. Chalk one up for common sense... though it's a shame it had to wait until an appeal to get the ruling right.

Filed Under: copyright, italy, liability, yahoo