Remember back at the beginning of the internet (as we know it today), when Yahoo was the be-all-end-all? It was the Google of the 90s – a fact that was also reflected in their stock prices.
In 2000, they were trading for $475 before falling victim to the dot-com crash.
In order to regain some the ground lost, Yahoo did what most tech conglomerates do: acquire.
Some questionable buys were arguably their first mistake (What’s a Flickr?)
Their second mistake was turning down $44.6 billion dollars from Microsoft in 2008.
That being said, there are some positives: Yahoo owns a fairly substantial stake in Alibaba, a Chinese e-commerce giant, and the social networking site Tumblr – though it was not enough to save them from standing on their own.
After years of CEO reshuffling, and a fairly significant security breach, Yahoo is now being bought out by Verizon, for a measly $4.8 billion… a far cry from what they could have gotten back in 2008.
So, what went wrong for Yahoo (besides missing a huge payday?). They went from being king, to being the jester that people openly make fun off.
Yahoo's homepage, February 2017
Simply put, Yahoo just isn’t good enough to compete in today’s technological market. The type of technology they offered was quickly overtaken by G-mail, Facebook, and other social media platforms. Even going to their website, seems like you’ve take a step back into the early 2000’s. It is therefore no surprise that their audience is a more mature demographic, which does not bode well for long term sustainability.
Of course, where there are no users, there are no revenues to be made from advertising, thus drying up a major stream of income.
Technology is a high-priced oligopoly, and in order to play, there must be significant capital, and significant assets in the arsenal. Through all of its different acquirements, Yahoo was just never able to find a real winner. Ultimately, lack of focus, inability to create change, and finding the right direction was the company’s downfall.
It will be interesting to see if Verizon chooses to strip down the company and invest in the most valuable parts, or if it tries to reinvigorate the core web portal.
What do you think? Is Yahoo too far beyond repair, or do you see it making a comeback?
Let us know in the comments below!