Daily Insights

Yahoo Talks Tech

By: Mackenzie Baker | Nov 09, 2020

Yahoo launches its first budget-friendly smartphone that includes a cellular plan and pre-installed apps. 

The Yahoo Mobile ZTE Blade A3Y smartphone is available in the brand’s bright, signature purple and will run on Android 10. The phone will also come equipped with Yahoo’s sports, email, weather, finance, and news apps, as well as its recently launched “watch together” service that lets users watch videos while video chatting with friends and family. The $50 smartphone will run on Verizon’s cellular network through Yahoo Mobile’s unlimited phone service. By offering a lower-priced device, Yahoo could appeal to budget-minded consumers. Yahoo’s smartphone marks its biggest leap from desktop to mobile services since being acquired by Verizon in 2016. Shifting to mobile offerings could also help Verizon stand out against rivals like AT&T, which has prioritized satellite and TV channel acquisitions. By reverting back to its core business of cellular services and products, Verizon could attract a broader group of consumers, thus expanding the reach of Verizon Media. 

The introduction of an affordable smartphone allows Yahoo to vertically integrate its services with Verizon while continuing to promote its own content channels, like Yahoo Sports and Yahoo Mail. By boosting the presence of its services on mobile and desktop devices, Yahoo could encourage media marketers to spend more ad dollars, knowing they could potentially reach a wider, untapped audience according to a Gartner report. Promoting its own mobile network via a smartphone could also help Yahoo generate subscription revenue, particularly as it notes that other smartphone brands, such as Apple’s iPhone, can be added to the carrier. Expanding its services to other smartphone brands allows Yahoo to build up its cellular presence while raising additional revenue. As Verizon prepares to launch its 5G service to all customers and devices, Yahoo’s Smartphone could appeal to an additional base of consumers. Launching the smartphone during the holiday shopping season could also interest younger consumers or their parents, who could see the smartphone as a reliable, affordable alternative to pricier devices on the market. 

By introducing a self-branded smartphone, Yahoo could achieve relevance with a new generation of tech savvy shoppers and level itself against competitors like Google, which also offers a smartphone. The launch could also help Verizon monetize beyond Yahoo’s web services, which in turn could bring in a new base of mobile-minded consumers and spark subscription rates.