Yahoo was the front door to the web for early internet users and its services still attract billions of users on a monthly basis. Many of the groundbreaking companies the likes Netscape found it difficult to survive in the first dot-com boom but Yahoo managed. Unfortunately it has reached its end an independent company, having been acquired by Verizon.
The deal was struck early weekend and has just been announced. Verizon will pay $4.8 billion to buy Yahoo’s core business. Yahoo’s consumer services the likes of search, finance, news, sports, email video and Tumblr will be integrated with AOL, a company acquired by Verizon last year for $4.4 billion. The idea is to utilize these services to offer more robust services to Verizon customers and advertisers.
Yahoo started as a directory website but soon offered much more service including shopping, searches, email and news. These services were free to users having been supported by advertising display on its various pages. The model worked for a long time but in the end, emerging companies the likes of Google and Facebook discovering that being ahead of competition is a continuous process requiring reinvention. At one time Yahoo flirted about buying the two companies during their infancies
Yahoo has been under constant management turmoil, with shareholders pressurizing for a quick solution which included the option to sell. Resulting from the sale, Yahoo’s shareholders will be left with approximately $41 billion in share in Alibaba as well as shares in Yahoo Japan and a small portfolio of patents.
Marissa Mayer, Yahoo’s chief executive, noted that she is planning to stay and loves Yahoo. She notes that it is important for her to see Yahoo into its next chapter. Her statement raises the question whether the Yahoo brand could completely disappear in early 2017 when the takeover completes. According to Michael Goodman, a director at Strategy Analytics, the possible disappearance of Yahoo brand is an open-ended question.
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