Industry observers say Verizon intends to acquire AOL for its ad-tech capabilities. But behind all good ad tech is data -- and lots of it. Both companies complement one another when it comes to data -- especially in terms of mobile location and behavioral data. The challenge lies in getting that information in a useable form, and using it in a way that's palatable to regulators and consumers.

"I think there is a lot of opportunity with this combination with respect to location data, but it's by no means a slam dunk," said Vikas Gupta, director of marketing and operations at location data firm Factual. Verizon, of course, has access to real-time and historical location data through its wireless service.

Put simply, the wireless service provider knows where people's phones are now and where they've been in the past, including retail business locations. Verizon's Precision Market Insights division has worked with advertisers to help measure the effect of sponsor messages -- even real-world signage in sports arenas -- on retail or restaurant purchases, for instance. AOL could enhance its attribution capabilities through that service.

And AOL brings a different kind of location data expertise to Verizon. While many Google Maps and Apple Maps users may have forgotten about AOL-owned Mapquest, Mr. Gupta sees an opportunity for enhancing Verizon's mobile location data with the GPS location data Mapquest manages. The type of data flowing through Mapquest that helps people find their destinations is different from the location data gathered to help pinpoint user locations for mobile services and ad targeting, he said.

"You're bringing a data asset with an organization that has a level of knowledge and history of dealing with this sort of data," said Mr. Gupta. Together, the two firms now have the potential to connect those complementary location data sets and push the information through AOL's ad-tech stack. Making that happen could require the help of location data specialists at Mapquest, he suggested.

Verizon gets an ad-tech platform from AOL, but the wireless firm will help AOL connect the dots to enable the robust cross-platform ad campaigns advertisers desire. Most companies tracking and targeting users across devices can, at best, "stitch together profiles that may or may not be at the user level," said Steve Latham, CEO of Encore Media Metrics, a campaign measurement firm. "The promise is that because of the position Verizon plays, it has … the ability to get access to a lot of data and persistent tracking on users." Others can only attempt to connect data together piecemeal, he said, while "Verizon is at the core of it."

For instance, suggested Mr. Latham, Verizon can track unique user sessions in mobile, and, when people go online to pay their Verizon bill, the firm can connect that data to a cookie ID storing browser data. "Verizon already has really unprecedented insight into what people are doing not just on their devices but also online engagement," he said.

And because Verizon subscribers use the service to view video on their phones and through their TV set-top boxes, the telco brings lots of additional behavioral video data to what AOL already has.

"You've got the holy grail which is a combination of location behavior and cross-device capabilities," said Jason Kint, CEO of digital publishing trade group Digital Content Next. "The industry is trying to figure out the post-cookie world, and this is certainly a path to that."

However, he cautioned, "We should have concerns already in terms of the amount of data that Verizon is able to see." Earlier this year, industry observers and privacy advocates criticized Verizon's use of a so-called "zombie cookie" technology that could track users even after they cleared their cookies.

"They can't just turn over everything to AOL," said Mr. Latham. "They're going to have to be very deliberate in terms of how to do this responsibly."

Verizon will have to decide whether it is worth risking its core wireless services revenue for a small chunk of incremental ad revenue derived from sophisticated data use. Before navigating privacy waters, though, the two companies will need to figure out how to connect their data in the first place.

"There is a tremendous opportunity here, but integration, as always, will be a challenge, for the usual M&A reasons, in addition to some of the nuances specific to the nature of carrier-generated location data versus GPS trace data used in navigation," said Mr. Gupta.