Yahoo recently announced, after a prolonged period of uncertainty, the sale of its core operating business to Verizon, the US’s largest wireless provider, for $4.8bn cash.
Yahoo began life as “Jerry and David’s guide to the World Wide Web” in 1994 when founders Jerry Yang and David Filo originally founded the tech giant. The website was originally designed as a website directory and was subsequently renamed “Yahoo”. Yahoo went on to grow exponentially and was worth at one point $125bn; however they were unable to keep up with Google and Facebook and they eventually failed to dominate the search engine world despite their early head start.
As a result of Verizon deal, Yahoo will integrate with another forgotten tech giant, AOL, who Verizon bought last year. Verizon’s decision to acquire both AOL and Yahoo within a year builds upon their desire to expand further in advertising technology and seeks to compete with existing market dominators, Facebook and Google. In addition, this deal provides Verizon with the added bonus of increasing their market share within the mobile content world with the potential to leverage nearly 140 million subscribers.
Whilst further details are yet to be unveiled, it is understood the sale to Verizon will not include Yahoo’s “Excalibur” portfolio, which is said to include Yahoo’s cash, non-core patents and amongst other things its shares in Alibaba Group Holdings. Furthermore, Yahoo chief executive’s Marissa Mayer plans to stay on with the company to continue her desire to deliver new advertising and digital marketing opportunities, but it is expected that Yahoo will change their name and become a registered, publicly traded investment company.
Ultimately, Verizon’s deal signifies a rather sorry end for a technology giant that once led the way at the height of the dot-com boom – nonetheless, the technology sector has always moved exceptionally fast, and Yahoo’s inability to keep up with competitor offerings has led to one of the world’s well-known companies to fall gloomily from grace.
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