Verizon wants to borrow T-Mobile and Vodafone's consumer data to take on Facebook and Google
- Verizon wants to license data from its competitors to bulk up its online ad business OathBusiness Insider Video
- This initiative could bring together competitors like T-Mobile and Sprint
- Ultimate plan is to take on Google and Facebook
Verizon Communications wants to challenge Google and Facebook. So it's reaching out to some of its biggest rivals in the wireless industry for help.
Now that the telecom giant has completed its acquisition of Yahoo and rolled out Oath, a division which includes a wide collection of digital advertising assets, it is looking to ramp up its ability to challenge Google and Facebook in the sector. The wireless giant is exploring building a data partnership with other top wireless players, including T-Mobile, Sprint, Vodafone and Telefónica, people with knowledge of the matter told Business Insider.
Specifically, Verizon wants to pool together more wireless consumer data that can be used for ad targeting. A big reason Google and Facebook are so dominant in digital advertising - besides the fact that their platforms reach huge audiences -is that they have powerful, accurate data sets on millions of consumers that can be used by advertisers to target people with more relevant ads.When Verizon purchased AOL two years ago, Oath CEO Tim Armstrong spoke openly about the power of Verizon's data and how it, coupled with AOL's advertising technology and large audience, could be used to put some real pressure on Google and Facebook on the ad targeting front. For example, Verizon knows where its customers live, where they travel, and what apps they use, all of which could be used to show people more relevant ads as they surf the web.
But while Verizon's US subscriber base is close to 150 million people, that's still rather paltry compared to Facebook and Google's massive audiences. So if it can license data from T-Mobile, for instance, it could layer on ad targeting signals from roughly 72 million more consumers.
In addition, licensing data from companies like Vodaphone and Telefónica would help Verizon expand its ad footprint outside the US, an area where advertisers have been pushing for progress, given Google and Facebook's global clout.
There's a lot to be worked out behind the scenes for such a data partnership to fully come to fruition. To date, just weaving together the various pieces of AOL and Verizon has proven particularly complicated. And the level of data that various wireless companies would be willing to license may vary widely. But Armstrong did discuss this plan in his pitch to top advertisers at the Cannes ad festival last week, said people familiar with the matter.
Verizon was potentially hampered by regulatory uncertainty during the waning months of the Obama administration. But since March when Republican senators voted to kill regulations in this realm, companies like Verizon are freer to exploit consumer data for advertising. (Of course, it's perhaps a different story in Europe, where regulators just hit Google with a monster fine).
Officials from T-Mobile and Telefonica declined to comment. Vodafone and Sprint did not return request for comment on this story.