Verizon’s Pursuit of Yahoo Puts the Spotlight on a Rising Star

(Bloomberg) -- As Verizon Communications Inc. gears up for a possible acquisition of Yahoo! Inc., the executive in charge of reinventing the phone company as a digital powerhouse is Marni Walden, who began her career selling handsets from a kiosk in a home-improvement store.

If Walden, the head of product innovation and new businesses for the $231 billion company, can successfully swing the transition, it may alter not only Verizon's course but also her career. The 49-year-old is on a short list of candidates to potentially succeed Verizon Chief Executive Officer Lowell McAdam, 62, a position never held by a woman.

The latest round of bids for Yahoo is due Wednesday, and Verizon is one of the leading contenders. But so far the company's digital transformation is off to a slow start. Go90, the free mobile-video service for teens overseen by Walden, hasn't attracted a massive following, and the bid for a failing Yahoo has puzzled Wall Street. She came under fire in April as analysts pressed her on why Verizon was venturing so deeply into mobile advertising and putting itself on a collision course with Facebook Inc. and Google.

“It's a high-risk, high-reward assignment,” said Rosabeth Kanter, professor at Harvard Business School who has studied Verizon's management for 10 years. “Marni brings a whole new skill and capability.”

Walden is trying to take digital ventures like subsidiary AOL -- and potentially Yahoo -- and use them to forge a new path for a company that dates back to Ma Bell. Not only is she the boss of the freewheeling AOL CEO Tim Armstrong, she also oversees wireless Internet services like connected cars and the company's push into online video, which will expand to premium subscription services. 

After spending $130 billion in 2014 to buy out partner Vodafone Group Plc's stake, McAdam wanted to protect Verizon's landline and wireless business while exploring new areas. He divided the task, naming John Stratton president of operations with responsibility for the main business. Walden was put in charge of new ventures.

“I needed to bring in some new talent, and Marni was the choice,” McAdam said. A product-development person from outside would have been an obvious choice, he said, but an insider with lots of operations skill and customer knowledge was key.

Walden doesn't exactly fit the mold of Verizon executives, who have largely been part of an Eastern boys club. Raised in Cheyenne, Wyoming, she's the second of three siblings, all of whom spent much of their youth on the family's cattle ranch.

“When I was growing up, I wanted to be either a cowboy or a ballet dancer,” Walden said. “But neither seemed like reasonable options.''

Leaving Wyoming

Wyoming held few prospects. Her grandparents sold the ranch, and when her older sister, April, moved to California for college, Marni followed and finished her last year of high school in Chico. Like her sister, she attended California State University at Chico.

Her first job after college was selling briefcase phones for General Cellular Corp. at a high table covered with a plastic sheet inside a Chico home-improvement store. That was 1991.

“I called my parents and told them I was going to work with a cellular company -- back then we called them car phones,” she recalled. “And my parents were like, ‘People are going to put phones in their cars?' And I remember them thinking, ‘This is not going to last.'''

Walden quickly rose from the kiosk to bigger sales duties at General Cellular. Within three years, she was opening stores and eventually managing multiple locations. Her ascent coincided with industry consolidation.

Big sister April took a parallel path in wireless. After Chico, she landed at San Francisco-based Pacific Telesis. PacBell, as it was called, spun off its wireless business in 1994 and named it AirTouch Communications Inc., where April served as head of investor relations.

Sibling Connection

When Marni wanted to relocate closer to the Rocky Mountains, April put her in touch with her colleagues at AirTouch, who eventually hired her to run that region. AirTouch was acquired by U.K.-based Vodafone in 1999 and became part of a wireless joint venture with Verizon. It was integrated into Verizon after the 2014 buyout.

Walden lives with her husband and son near Verizon's New Jersey office and travels the country weekly to meet with her teams.

At work, Walden pushes her staff to be efficient, though she has a playful side. If someone shows up late to one of her meetings, she fires up a karaoke machine and requires the laggard to sing as punishment. The punctuality rule applies to everyone, including AOL's Armstrong, who recalls having to sing John Denver's “Take Me Home, Country Roads” as penance. Walden remembers it as the soft-rock standard “Feelings.”

One area where Walden needs to exercise her muscles is outside the office, McAdam said. At first she was a bit awestruck by the Hollywood crowd she was thrown into in her new role making content deals for go90, he said.

“Now she's having conversations with them on a daily basis,” McAdam said.

Pursuing Yahoo

Those circles are fairly routine for AOL's Armstrong, who was in Cannes, France, for an entertainment conference last month and is attending Allen & Co.'s annual gathering in Sun Valley, Idaho, this week.

“My charter is to go stand up several businesses,” Walden said. “Tim runs one of those businesses and he is pretty independent. I let Tim run his business. He's very public. He has to be: He's competing with Google and Facebook and his customers and employees need to see him out there fighting for the business.”

To help Walden and Armstrong, Verizon has been pursuing the purchase of Yahoo. With its millions of users, online properties and ad technology, it could bolster AOL. Verizon is among the leading contenders, competing against Dan Gilbert, the founder of Quicken Loans Inc., and AT&T Inc., according to people familiar with the matter.

Walden's highest profile project is go90, a YouTube-like collection of short clips and shows supported by ad revenue. Verizon hasn't disclosed subscriber numbers but says it will provide some ways to show viewer engagement later this month when it reports earnings.

“I don't think the top people at Verizon are losing any sleep over whether go90 is a success or failure,” said Jennifer Fritzsche, an analyst with Wells Fargo Securities LLC. “Walden is a major pillar in Verizon's future. Her legacy won't be judged by go90.”

To contact the reporter on this story: Scott Moritz in New York at smoritz6@bloomberg.net. To contact the editors responsible for this story: Crayton Harrison at tharrison5@bloomberg.net, Mark Schoifet, Paul Barbagallo