AT&T shifts web business away from Yahoo, signs with Synacor

AT&T (NYSE: T) is shifting the web properties once hosted by Yahoo to a new provider, Synacor, including its portal, search feature, and branded applications, The Wall Street Journal reports.

While the move removes a big chunk of AT&T business away from Yahoo and may effectively end the genial 15-year relationship the two companies have had, it also hints at something else afoot as Yahoo entertains bids for its core search and advertising business.

After all, while it's still speculative, Verizon (NYSE: VZ) is said to be well positioned on the rumored shortlist of about 10 potential buyers for Yahoo after the web search company closed preliminary bidding on April 18.

For Synacor, nabbing the AT&T contract could provide it with a nice business boost that will bookend nicely with its turnaround story.

The multiscreen services provider cast around for a couple of years for IP video-based business on which it could pivot, acquiring various OTT technologies including NimbleTV, Zimbra and ad platform Technorati. After some boardroom drama and layoffs Synacor completed its turnaround at the end of 2015, showing a 5 percent growth in revenue and slashing its losses to just $400,000 compared to the $6.5 million it lost during the fourth quarter of 2014.

AT&T's partnership with Yahoo generated around $100 million in revenue per year, a Briley & Co. analyst estimated in a WSJ article. Under that contract, Yahoo and AT&T split search and display ad revenue from AT&T's default search website.

 For more:
- see this WSJ article

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