4 ms·

The article's conceit is that apparently she should have bought Netflix in 2012 which suggests some future article ideas for the author that practically write t

by Steko 11y ago

The article's conceit is that apparently she should have bought Netflix in 2012 which suggests some future article ideas for the author that practically write themself: maybe Wang Labs could have been turned around by buying out Microsoft in the 80's; maybe the railroad barons could have bought out Ford right as the model T was going into production, man we could do this all day! It's easy to be a visionary with 3 years of hindsight.

ZanyProgrammer 11y ago
And the possibility of such an acquisition ruining Netflix. I can't imagine a lot of Netflix engineers would've been happy to work for a dinosaur like Yahoo.
- coldtea 11y ago
  Why, aren't they professional engineers, working for pay? Or do they go where its the most fashionable?
  - briandear 11y ago
    They are in demand. Why would you work for someone like Mayer (famously against remote working for instance) when they can have their pick from dozens of other companies that don't have a smug, self important failure as a CEO. For example, she had her child there in the office with her while denying other people the same ability. She decries working from home yet she simply builds a nursery there in her office. Could any other employee simply take over the next cubicle and install their nanny? Of course not. The grand irony is that remote friendly companies like Github, Basecamp and others aren't looking to sell off their core business. So sure Netflix engineers are professional, but they aren't stupid.
  - ergothus 11y ago
    This is a high demand field. I definitely work for pay, but I can get this pay at a number of places (To clarify: I don't work at Netflix or Yahoo) So I want additional things from my job like respect, involvement, empowerment, learning opportunities, flexibility. Generally those things are harder (though not impossible) to get in larger firms that are mired in communication weight. Speaking with zero first-hand experience with either company, Netflix probably struggles to handle those issues already, and to merge with a larger company that is trying to tighten its belt is unlikely to improve the situation. I've worked for 3 companies so far that merged with a larger, more "traditional" company, and every times there was high attrition from the engineering side as people saw various "good" parts of their job go away, from things as small as more bureaucratic procedures to as large as technology switches. I myself left one company when the new company required everyone to wear ties "because our sales people have to", despite the fact that we were in a separate site that no client would ever approach. That was 1999 and East Coast :) In retrospect, that seems a silly reason to leave a company, but it resulted in a significant pay boost and my period of greatest learning in my career. And I don't wear a tie. Now, both Netflix and Yahoo ARE tech companies, so my anecdotal evidence above may not even apply, but generally in this field demand for coders far outstrips supply, and anything that makes coders uncomfortable in large numbers can really threaten the status quo.
  - PeterisP 11y ago
    Experience from other acquisitions shows that this sometimes is the case. In 'hot' professions, which at the moment include software engineering, pay is a "hygiene factor" - it is required but not sufficient to hold or attract people. While in theory the company holds all the "intellectual property", in practice in software-related companies most of their capital simply puts on a hat and goes away every evening; and [a change of] management, working environment and company culture may (and does) result in losing those people. If they eagerly joined company A to do X, then simply buying that company doesn't neccessarily mean that they will automatically accept working in company B doing Y even if pay will still be the same. For acquired startups, it's very likely that their engineers had quit a company like Yahoo just because they wanted to work for a company like Netflix instead, and would do that once again if the situation would repeat itself.
- yeukhon 11y ago
  This becomes a topic for acquisition management. You can keep it as a separate company with the highest possible autonomy. I don't know how much autonomy YouTube has over Google's core decision (i imagine there are debates who to drive the decision and the technology implementation). But obviously if Netflix were to be acquired by Yahoo, I see a fundamental demand to make Netflix into the Yahoo portal, because of the ad money, which I think would be a mistake (linking is a whole different story). At least YouTube is not integrated into Google portal which is a great decision.
  - ethbro 11y ago
    The portal design seems to solve a problem the web had in it's infancy: "How do I do X?" It seems like the problems then were more geared towards finding anything that accomplished the given goal. Whereas modern web users are spoiled for choice and can afford to pick best in breed. I think no one would use Google search if it were bundled with G+. No offense to G+, but it's an inferior network/product compared to the alternatives. Users do use Google search, or Youtube, or whatever because they are severable from their companies' ecosystems. There's probably also a huge ancillary benefit to corporate structure and development flexibility when your authority/responibility is silo'd by end user functionality. (Counterpoint: Bill Gate's infamous flame on the Windows Media Player update experience, whereas it was revealed that the user experience for updating a piece of software cut across three or four different departments)
    - yeukhon 11y ago
      I will look at Bill Gates' example. Absolutely, sometimes it does makes sense to integrate, but Yahoo having its own media content as part of their Yahoo! portal means they are likely going to think of a way to integrate Netflix into the portal, since netflix revenue is entirely from monthly subscription. They certainly can rebrand Community entirely under Netflix, but then they are leaving Finance, Sport and News entirely to Yahoo Portal, which is again, good on its own ground. Perhaps they will invent the new online TV ecosystem. The thing Netflix lacks is news. Yahoo can supplement that, but the whole Netflix will change, and it will be a huge innovation and a major game change if done right. YouTube on the other hand is a medium for all sorts of brands, so finding news can be chaotic.
Retric 11y ago
Netflix would have been a good buy in 2002, an ok buy in 2007, but a terrible investment in 2012. In 2015 it's second-quarter profit was $26.3 which is down significantly from 2014, but it's market cap is 55.6B because if investor insanity. Netflix is at the mercy of content producers who can extract most of the long term value.
- halo 11y ago
  Netflix's expenses increased due to continued international expansion. It has a very lucrative business model, not that dissimilar to HBO, which is extremely profitable. It was definitely undervalued until relatively recently. >The problem is there at the mercy of content producers who can extract most of the long term value. How is that any different from HBO? Netflix doesn't need to have everything, and, in general, Netflix can afford to outbid other services for content due to the sheer size of its membership and revenue streams.
  - x0x0 11y ago
    hbo is a content producer; netflix is a middleman getting into content production
jenshoop 11y ago
Agreed. This article had a distasteful smugness to it. The author was more keen on bravado-ing his own (self-appointed) business acumen than exploring why Mayer's strategies did not work. Come to think of it, the author was really calling out Mayer for not having the guts to go all in (personality attack) vs. examining how/why her strategies did or did not work.
hmahncke 11y ago
From a Yahoo shareholder perspective, there's no point to having Yahoo buy Netflix in 2012 unless there is 1) some synergy to have been gained, or 2) Yahoo is acting as a portfolio manager for its shareholders. If Yahoo shareholders wanted to own Netflix in 2012, they should have sold Yahoo shares, bought Netflix shares, and experienced those gains. If they wanted active portfolio management, they should have sold Yahoo shares and put their money with a portfolio manager.

by Steko 11y ago

ZanyProgrammer 11y ago

And the possibility of such an acquisition ruining Netflix. I can't imagine a lot of Netflix engineers would've been happy to work for a dinosaur like Yahoo.

coldtea 11y ago
Why, aren't they professional engineers, working for pay? Or do they go where its the most fashionable?
- briandear 11y ago
  They are in demand. Why would you work for someone like Mayer (famously against remote working for instance) when they can have their pick from dozens of other companies that don't have a smug, self important failure as a CEO. For example, she had her child there in the office with her while denying other people the same ability. She decries working from home yet she simply builds a nursery there in her office. Could any other employee simply take over the next cubicle and install their nanny? Of course not. The grand irony is that remote friendly companies like Github, Basecamp and others aren't looking to sell off their core business. So sure Netflix engineers are professional, but they aren't stupid.
- ergothus 11y ago
  This is a high demand field. I definitely work for pay, but I can get this pay at a number of places (To clarify: I don't work at Netflix or Yahoo) So I want additional things from my job like respect, involvement, empowerment, learning opportunities, flexibility. Generally those things are harder (though not impossible) to get in larger firms that are mired in communication weight. Speaking with zero first-hand experience with either company, Netflix probably struggles to handle those issues already, and to merge with a larger company that is trying to tighten its belt is unlikely to improve the situation. I've worked for 3 companies so far that merged with a larger, more "traditional" company, and every times there was high attrition from the engineering side as people saw various "good" parts of their job go away, from things as small as more bureaucratic procedures to as large as technology switches. I myself left one company when the new company required everyone to wear ties "because our sales people have to", despite the fact that we were in a separate site that no client would ever approach. That was 1999 and East Coast :) In retrospect, that seems a silly reason to leave a company, but it resulted in a significant pay boost and my period of greatest learning in my career. And I don't wear a tie. Now, both Netflix and Yahoo ARE tech companies, so my anecdotal evidence above may not even apply, but generally in this field demand for coders far outstrips supply, and anything that makes coders uncomfortable in large numbers can really threaten the status quo.
- PeterisP 11y ago
  Experience from other acquisitions shows that this sometimes is the case. In 'hot' professions, which at the moment include software engineering, pay is a "hygiene factor" - it is required but not sufficient to hold or attract people. While in theory the company holds all the "intellectual property", in practice in software-related companies most of their capital simply puts on a hat and goes away every evening; and [a change of] management, working environment and company culture may (and does) result in losing those people. If they eagerly joined company A to do X, then simply buying that company doesn't neccessarily mean that they will automatically accept working in company B doing Y even if pay will still be the same. For acquired startups, it's very likely that their engineers had quit a company like Yahoo just because they wanted to work for a company like Netflix instead, and would do that once again if the situation would repeat itself.
yeukhon 11y ago
This becomes a topic for acquisition management. You can keep it as a separate company with the highest possible autonomy. I don't know how much autonomy YouTube has over Google's core decision (i imagine there are debates who to drive the decision and the technology implementation). But obviously if Netflix were to be acquired by Yahoo, I see a fundamental demand to make Netflix into the Yahoo portal, because of the ad money, which I think would be a mistake (linking is a whole different story). At least YouTube is not integrated into Google portal which is a great decision.
- ethbro 11y ago
  The portal design seems to solve a problem the web had in it's infancy: "How do I do X?" It seems like the problems then were more geared towards finding anything that accomplished the given goal. Whereas modern web users are spoiled for choice and can afford to pick best in breed. I think no one would use Google search if it were bundled with G+. No offense to G+, but it's an inferior network/product compared to the alternatives. Users do use Google search, or Youtube, or whatever because they are severable from their companies' ecosystems. There's probably also a huge ancillary benefit to corporate structure and development flexibility when your authority/responibility is silo'd by end user functionality. (Counterpoint: Bill Gate's infamous flame on the Windows Media Player update experience, whereas it was revealed that the user experience for updating a piece of software cut across three or four different departments)
  - yeukhon 11y ago
    I will look at Bill Gates' example. Absolutely, sometimes it does makes sense to integrate, but Yahoo having its own media content as part of their Yahoo! portal means they are likely going to think of a way to integrate Netflix into the portal, since netflix revenue is entirely from monthly subscription. They certainly can rebrand Community entirely under Netflix, but then they are leaving Finance, Sport and News entirely to Yahoo Portal, which is again, good on its own ground. Perhaps they will invent the new online TV ecosystem. The thing Netflix lacks is news. Yahoo can supplement that, but the whole Netflix will change, and it will be a huge innovation and a major game change if done right. YouTube on the other hand is a medium for all sorts of brands, so finding news can be chaotic.

Retric 11y ago

Netflix would have been a good buy in 2002, an ok buy in 2007, but a terrible investment in 2012. In 2015 it's second-quarter profit was $26.3 which is down significantly from 2014, but it's market cap is 55.6B because if investor insanity. Netflix is at the mercy of content producers who can extract most of the long term value.

halo 11y ago
Netflix's expenses increased due to continued international expansion. It has a very lucrative business model, not that dissimilar to HBO, which is extremely profitable. It was definitely undervalued until relatively recently. >The problem is there at the mercy of content producers who can extract most of the long term value. How is that any different from HBO? Netflix doesn't need to have everything, and, in general, Netflix can afford to outbid other services for content due to the sheer size of its membership and revenue streams.
- x0x0 11y ago
  hbo is a content producer; netflix is a middleman getting into content production

jenshoop 11y ago

Agreed. This article had a distasteful smugness to it. The author was more keen on bravado-ing his own (self-appointed) business acumen than exploring why Mayer's strategies did not work. Come to think of it, the author was really calling out Mayer for not having the guts to go all in (personality attack) vs. examining how/why her strategies did or did not work.

hmahncke 11y ago

From a Yahoo shareholder perspective, there's no point to having Yahoo buy Netflix in 2012 unless there is 1) some synergy to have been gained, or 2) Yahoo is acting as a portfolio manager for its shareholders. If Yahoo shareholders wanted to own Netflix in 2012, they should have sold Yahoo shares, bought Netflix shares, and experienced those gains. If they wanted active portfolio management, they should have sold Yahoo shares and put their money with a portfolio manager.