AT&T Inc.’s (NYSE: T) surprise re-entry into the bidding for Yahoo! Inc. (Nasdaq: YHOO) is about gaining digital advertising assets. As a bonus, it could block the path of rival Verizon Communications Inc. (NYSE: VZ).

AT&T emerged alongside Verizon and several other bidders interested in Yahoo, people familiar with the situation said Wednesday. The two largest U.S. wireless service providers are facing sluggish subscriber growth and stinging price competition from smaller carriers, and have targeted video as a source of new revenue. But video won’t generate sales without advertising technology.

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