Tuesday , 23 October 2018
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Yahoo and AOL finally take entire world’s advice to merge, but it could be a decade too late

Yahoo and AOL finally take entire world’s advice to merge, but it could be a decade too late

It’s hard to find a more anticlimactic deal in the history of technology than the $4.8 billion Verizon acquisition of Yahoo announced today.

In taking this step, Verizon plans to effectively merge Yahoo with AOL, something every single human being on the planet has suggested the two companies do for well over a decade, and maybe even longer.

At long last, we will finally see if Verizon can take two wrongs and make a right.

Rose-colored press releases aside, the deal already feels a bit tired. Way back in 2006, when there were widespread reports that Yahoo might try to buy AOL, the concern was that Google had bought some video startup called “YouTube” and that Yahoo needed to respond. Later, there was competition with insurgents Facebook and Twitter. And of them mobile.

Amid a carousel of CEOs, the ultimate answer was always deemed to be the same: Yahoo and AOL should merge!

This remained the conventional wisdom even after Verizon bought AOL last year for $4.4 billion and persisted even after AOL CEO Tim Armstrong last year declared such a deal a “dead notion.”

Oops.

“We have enormous respect for what Yahoo has accomplished: This transaction is about unleashing Yahoo’s full potential, building upon our collective synergies, and strengthening and accelerating that growth,” Armstrong said today in a press release. “Combining Verizon, AOL and Yahoo will create a new powerful competitive rival in mobile media, and an open, scaled alternative offering for advertisers and publishers.”

Doubtful.

Had this deal actually been consummated a decade ago, when both parties had more heft and influence, there might have been some chance that it could have created something with the size and resources necessary to reboot itself. AOL has made some recent gains with its programmatic advertising. But, in general, it feels like both companies have been caught flat-footed too many times to matter at this point.

And so, despite the endless clamoring for these creaky old tech companies to get a room already, it’s worth remembering that it’s likely this deal will be a dud. That’s because most such deals end up being duds. Just ask Yahoo, which recently wrote its $1.1 billion acquisition of Tumblr down to almost nothing.

In the short-term, it’s likely that there will be more job cuts at Yahoo to shave costs. And there will be turf wars, as managers and executives at each company battle over who really has the upper hand across a variety of products and markets.

And, inevitably, there will be write-downs, excuses, and thumb-sucking about where it all went wrong.

There will be just enough chaos and crisis to keep us journalists occupied with the coming debacle that we have been pining for so long. It may even be enough to help us get over the fact that we will no longer have Yahoo to kick around.

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Verizon is a global broadband and telecommunications company and a component of the Dow Jones Industrial Average. It started in 1983 as Bell Atlantic (based in Philadelphia) with a footprint… All Verizon news »

Track Verizon’s Landscape to stay on top of the industry. Access the entire ecosystem, track innovation & deals. Learn more.

AOL Inc. (NYSE: AOL) is a brand company, committed to continuously innovating, growing, and investing in brands and experiences that inform, entertain, and connect the world. The home of a w… All AOL news »

Track AOL’s Landscape to stay on top of the industry. Access the entire ecosystem, track innovation & deals. Learn more.

Yahoo! is the premier digital media company. Founded in 1994 by Stanford PhD candidates David Filo and Jerry Yang as a way for them to keep track of their personal interests on the Internet,… All Yahoo news »

Track Yahoo’s Landscape to stay on top of the industry. Access the entire ecosystem, track innovation & deals. Learn more.

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