Yahoo Has Become More Like "Uh Oh"
Things are looking grim for Yahoo – what does this mean for the average internet user?
One of the internet’s most famous names may soon disappear from view, following the widely-anticipated $4.8 billion sale of Yahoo to America’s largest mobile operator, Verizon Communications. For many people, Yahoo powered their first tentative steps into email and search engines, yet one of the world’s most identifiable brands is about to slip into the murky waters of corporate takeovers. Where did it go wrong for Yahoo, and what do its customers need to know at this stage?
The Good Ole Days
Considering Yahoo was valued at $128 billion as the new millennium arrived, its subsequent decline appears shocking when viewed in isolation. Sadly, the seeds of its demise were sown many years ago by boardroom squabbling over the company’s precise identity. Its internet search engine has long since withered on the vine, driven into obsolescence by the fatal error of demanding payment for listings until 2002. At the same time, ‘Google’ was being voted the most useful word of the year. A switch to Google-style curated results proved too little too late, and Yahoo’s search engine presence has been a reupholstered version of Bing for many years.
In The News
At the same time, Yahoo’s much trumpeted news portal never established itself as a rival to media giants like the BBC or CNN. It failed to diversify in the right areas, acquiring over a hundred companies of which the vast majority failed or drifted into obsolescence, like pre-Instagram giant Flickr. Yahoo even managed to kill the once-mighty GeoCities platform and Broadcast.com, which it paid almost $6 billion for. The 2013 acquisition of Tumblr could have represented salvation, but $1.1 billion was a high price to pay for a niche social media platform that has rapidly fallen out of favor with the public. Remarkably, Yahoo could have bought Facebook for this sum in 2006, but it refused to pay more than $1 billion – a decision that will surely rank as one of the worst bluff-calls in corporate history.
What Happens Now?
Although Yahoo is no longer a self-governing entity, Verizon is likely to keep its popular homepage active for a while. That means existing Yahoo customers don’t need to find a new email provider yet, just as AOL customers can still use their old addresses despite last year’s Verizon takeover. The AOL homepage is a pale shadow of its formerly dynamic self, but the brand lives on as a refuge for dial-up users and as a surprisingly effective ad tech enterprise. Meanwhile, Yahoo-owned platforms like Rivals are sufficiently far removed from boardroom negotiations to continue as long as advertisers remain interested in them. Tumblr and Flickr may be sold off while their brands retain some value, though both are shadows of their former selves and the latter has been largely neutered by Instagram’s dominance.
What’s In It For Verizon?
Industry observers expect Verizon to use the AOL and Yahoo acquisitions primarily to create its own online advertising business, with this newly-expanded portfolio of websites offering wide-ranging appeal to large corporate advertisers. Since Yahoo’s user base is far more valuable than its tainted brand, the company’s name may one day disappear in a low-key rebranding exercise, with the yahoo.com homepage suddenly redirecting to Verizon or conceivably even AOL. It’s remarkable that two of the new millennium’s internet giants should effectively find themselves on life support, let alone at the mercy of an old-fashioned telecom company – one of the industries the internet was supposed to render obsolete. In the fluctuating and eternally unpredictable internet sector, it seems no brand is too big to fail.