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Verizon Explores Lower Price or Even Exit from Yahoo Deal
- accountable 10y agoYahoo has some good stuff, but their brand-name is just so, so toxic now. I hope that if the deal goes through (and I'm sure it will), Verizon will still keep the better Yahoo services running.
- ocdtrekkie 10y agoI have to imagine if they do buy it, they'll strip it for parts. They already have AOL, which has a dated name, but not one now synonymous with horrible security. And with the redundant properties between AOL and Yahoo, I can't fathom them not wanting to consolidate those, probably into a new brand entirely. Between AOL and Yahoo (and their own Verizon email addresses where they're an ISP), they'd have a huge portion of the world's email accounts, and I could see a push to pull an Outlook.com: Move everyone to a new service, but keep all the old legacy email addresses from older services.
- oddevan 10y agoOK, what's it going to take to keep tumblr running? That's literally all I care about here. Everything else in Yahoo can be gotten or done elsewhere, but tumblr's a social network, so there's value in preserving those connections.
- davidgerard 10y agoImport to Wordpress. They've been chronically unable to monetise Tumblr. Assume they could Geocities you at any moment.
- pjc50 10y agoYou can't forcibly migrate other people to wordpress, and its their blogs which have the value. Tumblr is an important community even if it does have a few weirdnesses and inconsistent policy enforcement.
- jstanley 10y agoPerhaps there's scope for a tumblr mirror, which could eventually take over from real-tumblr (and allow the blog owners to continue blogging) in the event that real-tumblr goes all geocities.
- hxegon 10y agoI feel like that would be a TOS violation.
- patrick_haply 10y agoIf a service doesn't exist, can you violate its TOS?
- deleted 10y ago[deleted]
- tajen 10y agoWe don't know whether Tumblr's porn content is legal. There's absolutely no way a risk department would allow hosting massive porn pictures of potentially underage volunteers (or not-so-volunteers), let alone acquire a company who does that as a job, or copy that content over for free. Porn ventures use specific advertising platforms, payment methods and insurances. I must be wrong, since Yahoo believes Tumblr increases its worth.
- komali2 10y agoHow is it an important community? I thought it was a blogging platform? Can't users just migrate to wordpress?
- dragonwriter 10y ago> OK, what's it going to take to keep tumblr running? If the Verizon deal falls through, I'd say "someone with the skill and resources to keep Tumblr running buying Tumblr, either together with other parts of Yahoo! or separately."
- stryk 10y agoIsn't Yahoo _really_ big in Japan? My understanding is a lot of their services are overwhelmingly popular there.
- ghaff 10y agoYahoo Japan is basically a separate organization, albeit with Yahoo investment.
- ghaff 10y agoFor me, it's Flickr that I would be annoyed losing. Not so much for my own photo hosting which is easily moved elsewhere. Everything is local on Lightroom anyway and I basically never use the social aspect of Flickr any longer. But Flickr is a great repository of other content, including a great deal of Creative Commons and public domain, that AFAIK isn't available with nearly the quantity or curation elsewhere. Maybe Google would buy given that it's pretty much bombed out on photo sharing itself.
- brilliantcode 10y agointeresting...forgot about flickr. to be honest imgur and even reddituploads pretty much killed it for me.
- leviathant 10y agoI use Flickr's API to drive some arts related websites. I also appreciate that Flickr stores (and exposes, with your permission) EXIF data. It doesn't overcompress images, and you can access the full resolution that you upload to. I really haven't found anything else quite like it, and I would hate to see it go away. I've been paying for my pro account for the last eight years.
- ghaff 10y agoSmugMug at least used to be considered a good alternative. They became less attractive after a pricing change a few years back but I haven't really looked carefully for a long time. My main requirement is that I can essentially just set up a new publishing channel from Lightroom and press "Go" (which I believe I can do with SmugMug). But, yeah, it was popular for a time to dump on Flickr because they hadn't really moved forward. But truth be told, it pretty much does the job for me the way it is and I don't want a whole bunch of social stuff dumped on it.
- chrisper 10y agoBut imgur and reddituploads are serving a different purpose? They are both just image sharing (no one cares if it is low quality). However, Flickr is for photographers who want high quality images and EXIF info etc.
- brilliantcode 10y agoMaybe it will end up like the geocities. All in all, I stay away from tumblr because the pages always crash and slows to a crawl. I'm not sure if Marissa accounted for the fact that Tumblr's users are far far less likely to look at ads than even FB.
- skuhn 10y agoThe short answer is: a ton of money. Tumblr has insanely high operating costs and practically no revenue stream. Yahoo has spent a lot of time and money (while fighting with Tumblr people) to get these costs down, but much of that work would be undone to separate Tumblr from Yahoo. So much of Tumblr's traffic is comprised "non-monetizable" porn sites that Yahoo foots the CDN bill for, which does nothing to build the brand or the social aspect of the service. They can't truly crack down on it though, because that would reveal the truth: there isn't that much real use to justify the spending.
- vertex-four 10y agoWell, they can't crack down on it because a significant amount of Tumblr's actual users are there for porn (both fanart and "regular" porn), at least in part, and would see doing so as censorship and being disconnected from the community.
- sytelus 10y agoWhy Tumblr has such high costs? It doesn't seem to warrant complicated infrastructure like search or Flickr. It shouldn't require 100s of people to maintain. A tons of eyeballs should translate to very significant revenues here.
- dismantlethesun 10y ago> So much of Tumblr's traffic is comprised "non-monetizable" porn sites that Yahoo foots the CDN bill for I'm curious why you find pornography to be non-monetizable. It's a $97 billion dollar industry, and is probably easier to directly monetize than a random mishmash of personal blogs because adult sites tend to focus solely on a single fetish, and there's a clear standardized categorization of such.
- skuhn 10y agoTumblr does not display ads on pornographic content. It is not something that Yahoo is willing or able to monetize, and yet it represents a substantial amount (perhaps the majority) of the cost of operating Tumblr. Maybe a future operator of Tumblr would feel differently -- but I think it would be difficult to monetize both sets of content simultaneously.
- jimmywanger 10y ago> so there's value in preserving those connections. Why is there value? Honest question, just curious. Do myspace friends, for instance, still have value in today's day and age?
- AdmiralAsshat 10y agoVerizon would be stupid not to walk away from the deal at this point. Setting aside that $4 billion was clearly way too much, Verizon, as the parent company, would be liable for any lawsuits against Yahoo resulting from the last few leaks.
- vthallam 10y agoI'm pretty sure that the latest round of negotiations would cover the part 'what if someone sues, who pays for it?". Also, Verizon got an awesome deal to buy Yahoo for $4 billion and there's no way they will walk away from it in their right mind.
- jimmywanger 10y agoI fail to see how it's an awesome deal. Verizon right now is only bidding for Yahoo's core business, not its Alibaba and Yahoo Japan shares. From what I remember, without those two assets, its core business is valued at less than zero. Why would you pay 4 billion for a company that's bleeding cash, open to huge liabilities for password breaches/backdoors, ever-shrinking user numbers, and no technology worth speaking of?
- jsjohnst 10y ago> and no technology worth speaking of? Seriously!? You really need to educate yourself if you believe that.
- chinhodado 10y agoIt's funny that $4b is deemed "way too much" for Yahoo when Snapchat is valued at $20b something, and Linkedin was bought for $26b. And Instagram and Whatsapp and all the other unicorns.
- bduerst 10y agoWere Instagram and Whatsapp unicorns? FB put down billion dollar purchases for them, but they weren't the inflated-valuation investor rodeos we see with unicorns.
- rokhayakebe 10y agoCan anyone explain to me why Yahoo is not worth over $4B?
- estefan 10y agoNo one wants to pay over $4B for it.
- iaw 10y agoSure thing! Imagine if I had two friends, Google and Yahoo. Both are asking me if they can borrow a dollar. Over the last few years when Google borrows a dollar it gives back an extra 3.5 cents the next year as a thank you. On the opposite side, when Yahoo has borrowed a dollar they've lost 13 cents within the next year. Left to their own devices, Yahoo will implode and be out of money in under 7 years, likely much sooner. The $4 billion price tag was a way of salvaging what may still be valuable properties within Yahoo, but the company on paper is rapidly losing money at any valuation. It's like asking someone to buy a car that's broken when it's unclear if they can fix it.
- rokhayakebe 10y agoHalve staff?
- bkeroack 10y agoReposting because this series of articles is by far the best explanation of the Yahoo situation over the past year or two: http://origin-www.bloombergview.com/articles/2015-12-02/yahoo-is-looking-for-a-new-way-around-alibaba-taxes http://origin-www.bloombergview.com/articles/2015-12-02/yaho...
- anton_tarasenko 10y agoYahoo controls 8% of search traffic and costs $4bn. Google controls 64% of search traffic and costs $558bn. That's a 17-fold difference in the price for 1% of the traffic. Even more if you take US search traffic only (to exclude Yahoo Japan). Verizon can get rid of the costly parts of Yahoo (mostly its media business) and have its own small Google to make cash. That was $1.8bn per year in 2015, while Yahoo's overall revenue stands at $3.9bn (Asia excluded). So Verizon buys the company at 1x revenue. Who would quit such a deal?
- dexwiz 10y agoIs Search traffic really correlated with revenue? I was under the impression Google was mostly ads revenue.
- rlanday 10y agoUhh yes and where do you think they show the ads?
- dexwiz 10y agoOh search sure, but I thought they would get more views on things like DoubleClick ads embedded in other pages.
- spullara 10y agoRevenue per search is at least an order of magnitude higher (maybe 2) than revenue per ad view.
- idunno246 10y agoA search ad is worth way more. Someone browsing the news isn't necessarily looking to spend money. A person searching for a book title(or any item or category) is probably looking to buy it. That data, intent data, is the key to their success in ads, because the person seeing the ad is way more likely to convert
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- serg_chernata 10y agoIs this related to the most recent hack? IE, are they valuing Yahoo as less now that there's more bad press?
- tyleraldrich 10y agoUh, yes. Look at the first sentence of the article: "Verizon Communications Inc. is exploring a price cut or possible exit from its $4.83 billion pending acquisition of Yahoo! Inc., after the company reported a second major e-mail hack affecting as many as 1 billion users"
- mitoyarzun 10y agoI think it's more than just bad press, it's more liability.
- swyman 10y agoFrom what I understand there's a clause in the deal that allows Verizon to walk away if Yahoo was hiding something "material" from them. http://www.wsj.com/articles/material-adverse-change-clause-is-rarely-triggered-1476402532 http://www.wsj.com/articles/material-adverse-change-clause-i...
- cmdrfred 10y agoI'm willing to bet you own Yahoo stock or have some connection to the company.
- untog 10y agoWhy, because they dared to voice an opinion contrary to your own?
- cmdrfred 10y agoI fail to see how 4 billion is a great deal for a company that lost a billion logins and is hemorrhaging cash.
- untog 10y agoAnd that's a fair, justified opinion to have. But attacking someone who holds a contrary opinion for having ulterior motives is an extremely uncharitable thing to do.
- cmdrfred 10y agoIt wasn't an attack and my summation was correct as he has friends that work there.
- vthallam 10y agoIt's crazy i am seeing this on HN. I feel Yahoo is all worth for the following reasons: 1) 2 decades old brand name everyone aware of 2) Yahoo! has some good products which is used by tons of people like Flickr, Finance, search(12% market share [0]), weather, media. They just don't have a mammoth money making one product which subsidizes the rest of the business like Google. Not to mention the tech talent and the culture that Yahoo! brings to Verizon. If you have any solid argument about why $4 billion is a waste, i would definitely like to hear. 0 : https://www.comscore.com/Insights/Rankings/comScore-Releases-January-2016-US-Desktop-Search-Engine-Rankings https://www.comscore.com/Insights/Rankings/comScore-Releases...
- heisenbit 10y agoFixing Yahoo seems impossible. It is bleeding cash and has at its scale no really credible strategic business model as a conglomerate of ideas. Selling it may fall flat now. Would it be possible to split it up? It may be easier to find a strategic direction for parts of it and maybe wind up others?
- bmh100 10y agoOne benefit of these incidents at Yahoo! is that they represent salient, clear examples of the cost of poor information security. CIOs and security directors will be able to point to this deal as evidence that poor security can have material impact on the business and destroy massive shareholder value, even years after the fact. A 6.5% intra-day dip sends a clear message. Even a CFO can now see that information security should be viewed as vital insurance that directly impacts shareholder value.
- DoctorNick 10y agoCurrently, Yahoo's only raison d'etre is to serve as a warning to others.
- dhimes 10y agoI remember this as a "Demotivational" poster, with a picture of the Titanic....
- 65827 10y agoYeah I mean the cost has always been there but this is the first time I recall lots of media coverage around the reality that incidents like this can cost billions, seems like it's finally sinking in.
- Swizec 10y agoI wonder how much this is influenced by shows like Mr. Robot where the entire plot revolves around infosec bringing down the world's massivest corporation. Of course Mr. Robot could itself be a symptom of the zeitgeist.
- jack9 10y agoI don't think many people understand what computer security means either way and to get a qualitative answer, you need to know about almost every aspect of development AT A PROJECT LEVEL. what is a potential buyer going to ask, "how's your computer security?" - "it's great, ok"
- CodeSheikh 10y agoLet's also not downplay the "Yahoo" brand name. It does not have much high impact negative publicity associated to it (yet). The name "Yahoo!" goes as far back as the Internet for modern day users i.e. 30+ yrs age group. If Verizon can put a nice spin to it and through micro-filtration of the brand whatever filtrate is left, as long as it is somewhat appealing it would sell, let it be a search engine or whatever new product Verizon offers free-of-cost to its subscribers over its data network. Verizon owns AOL and with that a few mobile advertising companies. As TV content is gradually getting further away form traditional set-top-box nightmarish cable providers and more towards individual content companies (Netflix, Amazon Video, HULU, HBO etc), this would be a good step for Verizon to head in that direction as well, maybe not produce original content (such as Netflix/Amazon) but perhaps air exclusive sports events. At the end of the day, it is all about maintaining your monopoly.
- __derek__ 10y ago> It does not have much high impact negative publicity associated to it (yet). A billion compromised accounts seems like it could fill that role. Many people may not understand their online information's privacy/security, but that's an ear-grabbing number.
- mholmes680 10y agoAgreed. Anecdotally, my mother called me last night asking what she needed to do about Yahoo's new breach. I said, no no, dont worry we already changed your password. She said nope, NEW news! My mother (and her news) heard this loud and clear. Thats a problem, and VZ has every right to renegotiate -- this has passed the point of "we're yahoo so we're big and an unlucky target". This is, in my mother's words, "what the hell is wrong with those people, I'm done, how do i get everything to go to gmail".
- hughw 10y agoIf you changed her password in September, you shouldn't have to change now, right? Since the "new" breach is from 2013.
- imkevinxu 10y agoLooks like Mozilla still stands to make a lot of money from this http://www.recode.net/2016/7/7/12116296/marissa-mayer-deal-mozilla-yahoo-payment http://www.recode.net/2016/7/7/12116296/marissa-mayer-deal-m...
- luhn 10y agoAccording to the email I received from Yahoo this morning, the data stolen was from 2013 and contains MD5 hashed passwords. MD5 hashed passwords. In 2013. Apparently Yahoo never made it out of the 90s.
- ChildOfChaos 10y agoThis is really just a news headline that really doesn't matter, or make any difference in the real world, who cares? the media just wants to make things seem bad so they can get some attention then on the back of that bad attention someone seeing an opportunity to save some money. Pathetic.
- x3n0ph3n3 10y agoA giant security breach leading to a potentially failed acquisition doesn't matter in a community of people focused on technology businesses? Nice one-word emotion signalling at the end, there.
- rivaldo 10y agoThe prospect of being part of the yahoo acquisition team at Verizon sounds dreadful. Yahoo has so many problems, so many things to figure out... it represents a close to impossible challenge to try to turn it around (in any way).
- cgvgffyv 10y agoThat's silly, of course the deal will go through. Verizon wants Yahoo on the cheap and somebody at Yahoo is helping.
- Animats 10y agoVerizon wants to acquire Yahoo "without the liability". What do they want to do, dump the liability on a business unit designed to go into bankruptcy?
- bogomipz 10y agoSo considering there has been at least two breaches that are known and given the size and extent of them is there no concern by Verizon that any intellectual property held by Yahoo might have been taken as well?
- anigbrowl 10y agoVideo of the merger team hard at work https://www.youtube.com/watch?v=fX4e81L-J7s https://www.youtube.com/watch?v=fX4e81L-J7s
- discardorama 10y agoHmm... I wonder if this is Yahoo's way of getting out of the deal?