Telecom company Verizon (VZ  ) is reportedly in talks to buy Yahoo (YHOO  ) for what appears to be less than $8 billion. The past few years have brought financial turmoil to Yahoo, despite repeated efforts to invigorate the business-from its purchase of social media site Tumblr to its push towards digital streaming. Despite the company's lackluster finances, telecom companies appear eager to buy Yahoo for its trove of consumer data and web/mobile advertising platform.

While most companies interested in a Yahoo purchase have remained silent, Verizon has made its intentions clear and a purchase seems logical considering the company's history of tech company acquisitions. Last year, Verizon acquired AOL for $4.4 billion, taking with it the online company's noteworthy Huffington Post and TechCrunch properties. The potential Yahoo purchase further bolsters Verizon into a position to challenge Google (GOOG  ) and Facebook (FB  ) as the two most prominent online advertising sellers. 

Yahoo has a dwindling ad sale business that has been hard-pressed to compete with Google and Facebook, but Verizon's data on its 135 million retail subscribers combined with access to platforms like Huffington Post and Tumblr may prove attractive to companies looking for online ad space should it merge with Yahoo. Currently, the lack of web advertising alternatives to Google and Facebook has created skewed supply-demand dynamics in the digital advertising space and marketers would likely welcome a third force to drive competition.

Yahoo's current $35 billion value is largely comprised of its holdings in Alibaba and Yahoo Japan, two internet powerhouses. The company has appeared reluctant to sell these holdings, though its stocks in Yahoo Japan may be up for grabs if Verizon wants to sweeten its deal and acquire those to pass along the stock to current Verizon stockholders. 

In order to block a potential competitor, Google is rumored to have explored a potential Yahoo acquisition, though there is little public information about such efforts. If Google were to purchase Yahoo, it could hinder Verizon's efforts to become a major challenger in the digital advertising sector as well as bolster its own offerings in comparison to Facebook. Though there are perks to a purchase, many analysts have shown concern over Yahoo's lackluster finances, especially the company's projected 15 percent revenue drop and 20 percent earning drop in 2016. 

Though Verizon has decided Yahoo's pros outweigh its cons, the question as to why other telecom companies aren't waging major bids is important to answer. AT&T (T  ) just acquired DirecTV for $45.6 billion and is still trying to integrate the company into its own operations, Sprint (S  ) doesn't have enough cash on hand to pursue a competitive deal, and T-Mobile (TMUS  ) has openly criticized telecom companies' move into media and is focusing on its core business.

Should a Verizon/Yahoo deal close in the coming weeks, Facebook and Google may be forced to incentivize marketers to stay on their platforms rather than migrating to whatever ad-hosting platform Verizon decides to introduce with its trove of Yahoo data and web assets. No matter what, such a purchase would shake up both the telecom and digital advertising spaces as companies continue to consolidate.