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The world’s biggest phone providers has just linked up with the world’s former reigning Internet leader.  On Tuesday (May 12) Verizon announced a $4.4 billion deal to acquire AOL in an all cash deal.

Reports the New York Times:

AOL, which acquired Time Warner for $165 billion in what is broadly regarded as a debacle and the high-water mark of the dot-com bubble, is now a shadow of its former self, managing a small collection of media and technology properties.

Verizon is billing the deal as a way for the company to expand its video offerings. Already a leader in distributing mobile video through its robust national mobile phone network, Verizon is making a push to become a leader in so-called over-the-top video, shorthand for television content distributed through the Internet.

But in acquiring AOL, Verizon is buying much more than websites that host streaming content. Along with its video and online advertising technology, AOL owns The Huffington Post, a sprawling collection of international news websites with growing traffic.

It also manages a dwindling but profitable dial-up Internet business, providing online access for those who live in areas too remote to have broadband, or who never canceled their subscriptions.

“Verizon’s vision is to provide customers with a premium digital experience based on a global multiscreen network platform,” Verizon’s chief executive, said in a statement Lowell C. McAdam. “This acquisition supports our strategy to provide a cross-screen connection for consumers, creators and advertisers to deliver that premium customer experience.”

AOL has become a proverbial hot potato in the world of struggling tech brands, but the acquisition is already having an impact with shares up 17 percent (curiously enough, Verizon shares dropped a bit).

The Verizon/AL acquisition is expected to go through this summer.

Photo: AOL

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