Earlier this week Verizon (NYSE:VZ) announced its acquisition of AOL (NYSE:AOL) in a $4.4 billion bet driven by a push into mobile video and targeted advertising.
At the heart of AOL’s video technology, lie Ran Harnevo and three startups acquired by AOL over the past five years, says The Wall Street Journal. Two of the companies, 5MinMedia (co-founded and headed by Harnevo) and Adap.tv were founded by Israelis, and the third, Convertro, has an R&D center in Israel.
In October 2013 AOL formed a Global Video division with Ran Harnevo at the helm. The acquisitions gave AOL the ability to monetize video clips and much of its growth in ad revenue was due directly to these acquisition.
According to AdWeek, Ron Harnevo, the man widely considered to be the force behind AOL’s massive video growth, left AOL last October, to go back to what he loves: “being an entrepreneur, inventing shit.” According to re/code, AOL’s video revenue was only about $10 million or more in 2010 when Harnevo joined the company. By 2014, it added up to hundreds of millions.
“The television market is going to go through a major disruption. That’s the gist of this deal. Video is going to encompass TV and it will be on all the screens,” Harnevo told WSJ. AOL, under CEO Tim Armstrong, has been working towards a convergence of TV and video, Harnevo said. “The tipping point will take less than 5 years. Verizon knows AOL has the biggest infrastructure needed after Google and Facebook. By buying AOL Verizon can enter the advertising market,” he added.