Yesterday came the confirmation of the agreement for which Verizon will acquire Yahoo! web activities for $4.83 billion to be paid in cash. The deal doesn’t include some Yahoo! activities such as the partecipation in the Chinese eCommerce Alibabawhich will form a new company. The acquired business will be integrated with those of AOL, acquired by Verizon just over a year ago.
Now it’s easy to remember that in 2000 Yahoo! was considered one of the web superpowers with an estimate of its value that at one point reached $125 billion. It was the period of the great speculative bubble so the figures were hypertrophic. In 2008, however, in a very different period, Microsoft tried to buy Yahoo for $44.6 billion and, after the first failure, made one last attempt adding another $5 billion. The company seemed to be able to still increase its value and its shareholders rejected that offer too.
Hindsight is really 20/20 because in the following years began the decline of Yahoo! with a series of CEO changes that didn’t bring the expected benefits. Marissa Mayer (photo ©Mrgadget3000) was appointed in July 2012, considered the key to the company’s revamping. After some acquisitions some sales started and the elimination of various services, including the historical Yahoo! Directory. Not exactly brilliant moves and especially not enough to reverse the negative trend.
Despite its decline, Yahoo! still has interesting services such as Finance and Sports which can bring a great revenue after the merger with AOL and the synergy with its contents. AOL CEO Tim Armstrong will retain his position after the acquisition with the plan of trying to compete with Google and Facebook in the field of digital contents. It will be far from easy but if he can integrate Yahoo! into AOL the company will be strengthened.
No official information was provided on the future of Marissa Mayer, who according to some sources could remain in the new company, although it’s not clear in what capacity, whilst others claim that she could leave Yahoo! with a $57 million exit package. In short, a nice comfort considering that she failed to do the job for she was hired for. Indeed she seemed the right person but maybe for Yahoo! it was already too late.
Thus ends the story of one of the first really big companies of the Internet age. Anyone who has seen the first web developments remembers well the years when Yahoo! was a landmark but also the subsequent years, with its decline. It’s the perfect example of a company that was cutting-edge but at some point stopped innovating and this is how it ended.