7 ms·

Why Did Yahoo Buy Summly?

176 points by scholia 14y ago

volandovengo 14y ago
Interesting but confused on the conclusion... If the real story is that Yahoo bought the technology to summarize articles from SRI International, who partly owned Summly -> why did Summly's owners make 30 million?
- lingben 14y ago
  do you seriously expect coherent thought or real journalism from BI?
  - taopao 14y ago
    No, I expect top 10 lists, press releases, and slideshows!
- citricsquid 14y ago
  The article isn't clear but could it be that Summly has a licensing deal with SRI for their "summarisation technology" and Yahoo wants to take full ownership of that "summarisation technology" and the licensing deal Summly has means that's not possible for Yahoo to do? For example Summly could have the only (maybe exclusive?) 5 year license on whatever... so Summly is acquired by Yahoo and now Yahoo has the only license and full ownership? Would Yahoo acquiring the licensed SRI technology allow them to void any existing licenses?
- Notre1 14y ago
  Exactly. I came here looking to see if anyone else had a good idea of what theory this article was trying to express. I think the author is trying to infer that Yahoo agreed to buy Summly, so that SRI could liquidate their equity in Summly. Maybe, SRI saw Summly as a loser and as part of their negotiations with Yahoo, they asked Yahoo to turn this loss position into a win. So, maybe, then that $30M price was really $20M as part of the SRI deal and then $10M for assets and aqui-hire talent of Summly itself. Acquiring Summly seems to have been an almost incidental side effect of a deal Yahoo made with SRI for a piece of "summarization technology." A source tells us that Yahoo has "agreements in place" with SRI for "knowledge transfer," and the acquisition of IP, code, and technology. Until Yahoo bought it, SRI International held equity in Summly.
  - UK-AL 14y ago
    Eh, surely just paying that acquisition money directly to sri would be a better win?
    - samstave 14y ago
      Maybe that would be too overt. Maybe they needed to get a way to get a license with SRI that didn't look like a me too act and also nullify existing licenses. If SRI actually had equity in Summly, then this is a way to pay off SRI, grab the license for Summly and potentially get SRI to make a change to its licensing agreement with other companies in Yahoo's best interest. However, I thought that Apple wholly owned SRI, which would make my speculation BS...
jmduke 14y ago
Tech news from the USAToday news section and TechCrunch to Anandtech and, yes, Hacker News was dominated by news of the Summly acquisition for five days. That PR alone was well worth the purchase price.
- acgourley 14y ago
  30M is a lot, I'm not actually sure it alone was worth it.
- volandovengo 14y ago
  Hmmm... but this is bad PR. The PR read that Yahoo is acquiring a company but shutting down its product and getting only 2 of their engineers for 30 million dollars. PR like that gets Yahoo's name in the press but does nothing to improve the image that Yahoo has no idea what it's doing.
  - JacobAldridge 14y ago
    "does nothing to improve the image that Yahoo has no idea what it's doing." I think that's true, but only true to those people who read (or remembered or understood) beyond "Yahoo buys hot new company, hot new technology, hot new talent". The PR implication is that Yahoo is investing in once again being hot and new. For those of us who understand the details of the company and product being bought, Yahoo's reputation was already entrenched. For the majority of readers, however, "hot new Yahoo" was the takeaway[1]. [1] Based on my experience as a journalist / writer, and the half dozen people who raised Summly in conversation with me the week the acquisition went public.
    - Jare 14y ago
      > "Yahoo buys hot new company, hot new technology, hot new talent" IMHO, any non-tech person who read that bit of news will likely have never heard of Summly, and will only remember the age bit. Which kind of makes it all read as "Yahoo needs help from teenagers" and conjures images of kids roaming around the company.
    - 14y ago
UK-AL 14y ago
Why didn't they just go direct to SRI? I'm guessing summly got a good lisencing deal.
- jfb 14y ago
  A better deal than Yahoo! could've gotten? That doesn't smell right to me.
  - jfb 14y ago
    Also, if it is true that a) Summly got a better deal than Yahoo! could've; and b) that those terms were transferrable in the case of a change of ownership ... well, some poor dumb bastard at SRI legal is probably having a very bad month.
- nilkn 14y ago
  I'm confused on how summly would have gotten a better licensing deal than Yahoo! could have managed. [Honest question.]
  - kd0amg 14y ago
    Plain old price discrimination? I wouldn't expect SRI to try to get a Yahoo-sized license fee out of some tiny startup.
    - jeffgreco 14y ago
      Sure, but would a tiny startup get exclusive rights?
  - sks 14y ago
    Maybe they got an exclusive license when yahoo wasn't event remotely interested in the tech. Just a guess.
- gojomo 14y ago
  Reading between the lines, I'm guessing Yahoo really liked the SRI tech (perhaps also with some of the additions made by Summly). They wanted to exclusively lock it up. If Yahoo had gone just to SRI, a competitor could have bought Summly... and Summly may have had, as part of SRI's stake, a perpetual and transferable license that Yahoo didn't want falling into any other acquirer's hands.
theatraine 14y ago
I would be interested to see the Summly summarization of this article! I think it would read something like this: Yahoo bought Summly, a startup with an app that not many people used, made no money, and employed no technical geniuses (since it wasn't actually built by them), because Marissa Mayer believes summarization technology is "going to be huge for Yahoo".
- runnr_az 14y ago
  Yeah... I guess? Doesn't really help it make sense....
  - harlanlewis 14y ago
    I believe that is exactly the point.
michaelochurch 14y ago
Further, D'Aloisio deserves credit for outsourcing technology development and app development to the right firms, and coalescing their work into a product that made him millions. I can't tell if this is a brilliant dog-whistle dig or if it's actually being said without irony.
- Hitchhiker 14y ago
  I am afraid, its being said without irony.
- eli 14y ago
  I don't think it's ironic. I also don't think managing and coordinating multiple outsourced developers is at all trivial. (Though, true, it's probably not worth millions either.)
  - UK-AL 14y ago
    Yes, but somo isn't some cheap outsourcing company. They will completely design your app, and then develop it for you. Its isn't a company where you manage a group of contracted coders.
    - eli 14y ago
      Fair enough. I don't know anything about them. I think my point, in a roundabout way, is that for many/most startups the actual writing of lines of code is not the hard part. At least, that's what I've found to be the case. If you can successfully outsource that task, more power to you.
      - rkuykendall-com 14y ago
        Kevin Rose paid someone a fixed amount to write Digg, and then paid other people salaries to continue writing it. Writing code is not the most important part of most businesses, excluding the few which are built on an emerging technology. Facebook, Amazon, HackerNews, Reddit, Wikipedia, Twitter, none of these would be hard services to get to 1.0 for any halfway decent programmer. But somebody had to know what to build, they had to believe in it, and they had to work for it, to learn from their mistaks and flush out the vision. And most of these people probably paid somebody else to write most of the code.
fnbr 14y ago
Are there sources for the $30 million? I've only seen it mentioned in secondary sources, never in an official Yahoo press release (or similar). I suspect that was leaked, and the real price was much lower.
securingsincity 14y ago
I actually stopped reading Gizmodo because i thought the article where they made him cry a few years back was too far. Shaming a 15 year old kid publicly no matter how annoying seemed too far. Now he successfully gets summly acquired and the support for and shade that has been thrown at this kid has been so massive. I still don't know what to think of the kid, but I do think that SRI's tech definitely meets the needs of Yahoo and would fit perfectly with their media content.
- UK-AL 14y ago
  I don't like how they treated him. However I think it does expose the difference between media reporting(tech genius,visionary, future leader, hard working) and actual reality(Narcissistic, child like, unprofessional). And those traits have been exposed again, since he claimed to invent the tech and developed the app in the media. Media have hailed shower of praises, mainly because he uses a top PR agency. Its kind of depressing for me, because it seems to mean being showy, and having a good PR facade is worth far more than people doing the actual work.
  - badgar 14y ago
    > Its kind of depressing for me, because it seems to mean being showy, and having a good PR facade is worth far more than people doing the actual work. Marketing is a huge part of the startup world. There's a reason people are told to stop building at MVP - what you build isn't really important, and you're really likely to throw away what you built and switch to something else.
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bsimpson 14y ago
I just read the whole article, and I still don't know why Yahoo! bought Summly.
- spoiler 14y ago
  I guess it has something to do with IP. The way I understood it was that the company Summly licenced the summarisation algorithm was selling it to Yahoo!, but they couldn't do that because Summly was using it, too. So, to get them out of the way, Yahoo! bought them and shut them down. Disclaimer: This is just the way I understood it, I might be partially or completely wrong.
  - bsimpson 14y ago
    That's my gist as well, but for an article with such a bold title, it doesn't really say much.
  - dhaivatpandya 14y ago
    That doesn't make much sense - as far as I understand, so far as the US, you cannot patent or hold a license over an algorithm, only an implementation thereof.
    - LucasCollecchia 14y ago
      Yes, but if the algorithm is a trade secret and you're licensing it out with terms of use that aren't favorable to you, you may determine that its in your best interest to buy the company rather than get sued for breach of the licensing contract depending on how much cash you're anticipating to lose through that litigation.
- signalsignal 14y ago
  It was insider dealing involving a minor who's family has very powerful connections.
algosio 14y ago
The Sad Part is they could actually be out buying companies like http://www.algorithms.io http://www.algorithms.io
- googoobaby 14y ago
  The developers probably don't have the pedigree that Marissa demands.
jgalt212 14y ago
Perhaps Yahoo saw some positive benefit in paying off Summly's coterie of celebrity investors and advisers. http://summly.com/about.html http://summly.com/about.html
- el_fuser 14y ago
  Wow... That reads like a poster for the slogan "it's not what you know, it's who you know".
mindcrime 14y ago
Dear Marissa: The next logical step for Yahoo! is to move into the enterprise. I know a great startup you could acquire that would accelerate your move into that space. I expect it could be had for somewhere around what you paid for Summly. Call me. Mindcrime
- mgkimsal 14y ago
  usually helps to put a phone number if you're expecting a call.
  - mindcrime 14y ago
    It's in my profile. :-)
jahansafd 14y ago
Very few people invent anything. Most developers with limited resources work with groundbreaking technologies(built by others) to create something meaningful.
- deleted 14y ago
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bonjourmr 14y ago
Everyone around the world was saying 'Yahoo' a fortnight ago for the first time in a long time because of this purchase of summly and coincidentally, Yahoo also quietly became the default search in Safari for iPhones during March. I like to think this is all great marketing and survival positioning by Yahoo as the big 3 companies/partnerships (read on) rear up for an exciting next few years in technology. Why would Apple change the default search? Well Apple and Google are the main rivals in the mobile market, it makes sense for both Apple to choose an alternative default search engine, as they don't want to strengthen their main rival. I also think Apple's recent 'interest' in robotics (Siri, hiring ex-segway engineer) v.s. Google's robotic cars & Glass, this will be another front that Apple will have to fight Google on. "1 Billion People Will Use Mobile As Primary Internet Access Point In 2012" http://googlemobileads.blogspot.com.au/2012/02/consumers-love-their-smartphones-now.html http://googlemobileads.blogspot.com.au/2012/02/consumers-lov... That leaves them with two options, the first being Bing. No way in hell would they choose Microsoft to partner with, with MS' purchase of Skype and close ties with FB you can expect MS to push harder than ever in the Mobile space, over the next few years (assuming they can tie all of their products together neatly). So that really only leaves Yahoo for search, which works out well for both companies; Yahoo get to survive the battle of the big 3 and still appear somewhat relevant and Apple are no longer strengthening their main rival. I really have no idea what I'm talking about but it sounds interesting. tl;dr - purchase of summly was marketing and survival by Yahoo
- Me1000 14y ago
  Google is still the default search engine on the iPhone. They just removed the "google" button and replaced it with "Search"
deleted 14y ago
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ksherlock 14y ago
Maybe this was edited in later (I missed it the first time), but... >Though Summly's own Web site once said: "SRI International, with the help of the Summly team, built the summarization technology behind Summly," we are told that D'Aloisio "invented" the product's original technology. >In a statement provided to us by a Yahoo spokesperson, an SRI spokesperson says: "Basically, Nick developed the original code for Summly." >"After the original product was built, SRI supported development of the technology and provided artificial intelligence expertise in machine learning and natural language processing." I don't know about you, but I need a pretty large grain of salt. http://www.youtube.com/watch?v=Y11ps1H6Aq4 http://www.youtube.com/watch?v=Y11ps1H6Aq4 is a youtube demo of his first app, trimit, 9 months and $300,000 in VC before summly. It seems 2 comprez ur mezages like this. Maybe that's the original code.
- eridius 14y ago
  At the 1 minute mark he says "some other.. form.. of documentation.. which I don't know what that is". So either he misspoke, or he didn't actually even develop that original app.
  - dangero 14y ago
    The video isn't made by the Summly founder. It's just a random person reviewing the app.
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podperson 14y ago
I used automatic summarization to try to reduce the article to a pithy tweet and ended up with: "Fuck, I don't know. And what's with Bezos investing in BusinessInsider? And what is Amazon's business plan anyway? And why does Apple's stock keep dropping whenever it gains market share?"
- OGinparadise 14y ago
  And what's with Bezos investing in BusinessInsider? For peanuts they more or less buy good coverage in a widely read news site. A certain VC fund also invested in them and PandoDaily. It's a great investment, even if Business Insider goes kaput 2 years from now.
brudgers 14y ago
To the degree Summly's license to the technology was transferable, the purchase makes a lot of sense because it prevents strategic acquisition of Summly by a potential Yahoo competitor. Even if not transferable, the purchase prevents Summly from partnering with a Yahoo competitor, and that is very likely to have been allowed by Summly's license. With nearly $4 billion in net income last year, the purported purchase price is less than a penny to the dollar.
spdy 14y ago
It´s a strategic investment to make people invested in Summly happy. http://summly.com/about.html http://summly.com/about.html Their will be follow ups and some of them might lean towards Yahoo on the next acquisition.
- notlisted 14y ago
  My thoughts exactly. The 17MM was a 'cheap' way to save face for big-name investors and "celebrities" who'd been duped. Circle-jerk money. "Angel Investors and Advisors include; Ashton Kutcher, Betaworks, Brian Chesky, Hosain Rahman, Jessica Powell, Joanna Shields, Josh Kushner, Mark Pincus, Matt Mullenweg, Seb Bishop, Shakil Khan, Spencer Hyman, Stephen Fry, Troy Carter, Vivi Nevo, Yoko Ono and many more. We are also working closely with News Corporation on the summarization of their content." Edit: actually, reading all of the comments on this page, I think my explanation is less likely than the "summly may have had a special license, and SRI couldn't be sold unless summly was acquired as well" (without resulting in lawsuits or sub-licensing deals) and/or "a nice way to pay more for SRI via the backdoor" (artificially increasing the value of the summly stock they held -> more $$ for SRI). Do we know how much stock SRI owned of the company? Perhaps they provided services in exchange for summly shares? Wouldn't be the first time.
fauldsh 14y ago
I'm getting increasingly intrigued to how much advertising they're getting for their $30m
jasonkester 14y ago
You know, I think I prefer to live in a world where giant tech companies occasionally act in strange, irrational ways that result in random people getting multi-million dollar windfalls. Especially if said people vaguely resemble, well, me. That being, entrepreneurial software folk running companies with trivially buildable products. That's the sort of person in my mind that should have as many foolish megacorporations as possible stumbling over one another to randomly dump tens of millions of dollars in cash upon them. Given the alternative world, where all companies behave rationally at all times and nobody ever makes mistakes that could possibly make, say, me a gozillionaire overnight, I think I'll keep living in this world. Keep up the good work, Yahoo! [Disclaimer: I own a small pile Yahoo stock (that made me a bunch of money in the 90's and has been taking it steadily back ever since), so I probably lost a few hundred dollars because of this particular deal. I'm happy to pay it, much as people who buy lottery tickets are happy to pay it. Having a crazy, aquisition-happy company out there doing its thing is more than worth the price]
- deleted 14y ago
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- macspoofing 14y ago
  >You know, I think I prefer to live in a world where giant tech companies occasionally act in strange, irrational ways that result in random people getting multi-million dollar windfalls. You're in luck, that happens all the time with executive compensation packages.
biswajitsharma 14y ago
Now about that Kid, D'Alosio ... I don't care he built it or not, he made money like a crazy chicken!! I think that's enough!! :) Coming back to Yahoo! I believe Marissa Mayer has something in mind. She is a smart lady, smart enough to point out what we are pointing out here. If not, we'll soon see another JC Penney episode here.
ig1 14y ago
Flagged. This article contains zero new information and just speculation. Unless you were involved in the transaction you have no idea what was involved. Maybe they overpaid and maybe they didn't. If you believe Yahoo are stupid you're free to go and short Yahoo shares. They are after all a publicly traded company. Lets stop with all this stupid speculation where people rehash the small amount of public information for the purpose of linkbait.
louischatriot 14y ago
It's great to get some insight on a deal that, frankly, I couldn't understand. I am of course biased, because I believe (like many others) that algorithms are bad at summarization, except for already well-structured content (news are usually like this). That includes most blogposts and videos. My startup (tldr.io) is trying to actually solve the summarization problem using crowdsourcing. For example, here is the summary of this article: https://tldr.io/tldrs/516542c52dcbc1ab3b0000d2/heres-the-real-reason-marissa-mayer-bought-a-17-year-olds-startup-for-30-million https://tldr.io/tldrs/516542c52dcbc1ab3b0000d2/heres-the-rea...
fosterzone 14y ago
Well curated article Thanks
LandoCalrissian 14y ago
My question then, is why didn't Yahoo just try and work with SRI International directly and not deal with Summly?

176 points by scholia 14y ago

Interesting but confused on the conclusion... If the real story is that Yahoo bought the technology to summarize articles from SRI International, who partly owned Summly -> why did Summly's owners make 30 million?

lingben 14y ago
do you seriously expect coherent thought or real journalism from BI?
- taopao 14y ago
  No, I expect top 10 lists, press releases, and slideshows!
citricsquid 14y ago
The article isn't clear but could it be that Summly has a licensing deal with SRI for their "summarisation technology" and Yahoo wants to take full ownership of that "summarisation technology" and the licensing deal Summly has means that's not possible for Yahoo to do? For example Summly could have the only (maybe exclusive?) 5 year license on whatever... so Summly is acquired by Yahoo and now Yahoo has the only license and full ownership? Would Yahoo acquiring the licensed SRI technology allow them to void any existing licenses?
Notre1 14y ago
Exactly. I came here looking to see if anyone else had a good idea of what theory this article was trying to express. I think the author is trying to infer that Yahoo agreed to buy Summly, so that SRI could liquidate their equity in Summly. Maybe, SRI saw Summly as a loser and as part of their negotiations with Yahoo, they asked Yahoo to turn this loss position into a win. So, maybe, then that $30M price was really $20M as part of the SRI deal and then $10M for assets and aqui-hire talent of Summly itself. Acquiring Summly seems to have been an almost incidental side effect of a deal Yahoo made with SRI for a piece of "summarization technology." A source tells us that Yahoo has "agreements in place" with SRI for "knowledge transfer," and the acquisition of IP, code, and technology. Until Yahoo bought it, SRI International held equity in Summly.
- UK-AL 14y ago
  Eh, surely just paying that acquisition money directly to sri would be a better win?
  - samstave 14y ago
    Maybe that would be too overt. Maybe they needed to get a way to get a license with SRI that didn't look like a me too act and also nullify existing licenses. If SRI actually had equity in Summly, then this is a way to pay off SRI, grab the license for Summly and potentially get SRI to make a change to its licensing agreement with other companies in Yahoo's best interest. However, I thought that Apple wholly owned SRI, which would make my speculation BS...

jmduke 14y ago

Tech news from the USAToday news section and TechCrunch to Anandtech and, yes, Hacker News was dominated by news of the Summly acquisition for five days. That PR alone was well worth the purchase price.

acgourley 14y ago
30M is a lot, I'm not actually sure it alone was worth it.
volandovengo 14y ago
Hmmm... but this is bad PR. The PR read that Yahoo is acquiring a company but shutting down its product and getting only 2 of their engineers for 30 million dollars. PR like that gets Yahoo's name in the press but does nothing to improve the image that Yahoo has no idea what it's doing.
- JacobAldridge 14y ago
  "does nothing to improve the image that Yahoo has no idea what it's doing." I think that's true, but only true to those people who read (or remembered or understood) beyond "Yahoo buys hot new company, hot new technology, hot new talent". The PR implication is that Yahoo is investing in once again being hot and new. For those of us who understand the details of the company and product being bought, Yahoo's reputation was already entrenched. For the majority of readers, however, "hot new Yahoo" was the takeaway[1]. [1] Based on my experience as a journalist / writer, and the half dozen people who raised Summly in conversation with me the week the acquisition went public.
  - Jare 14y ago
    > "Yahoo buys hot new company, hot new technology, hot new talent" IMHO, any non-tech person who read that bit of news will likely have never heard of Summly, and will only remember the age bit. Which kind of makes it all read as "Yahoo needs help from teenagers" and conjures images of kids roaming around the company.
  - 14y ago

UK-AL 14y ago

Why didn't they just go direct to SRI? I'm guessing summly got a good lisencing deal.

jfb 14y ago
A better deal than Yahoo! could've gotten? That doesn't smell right to me.
- jfb 14y ago
  Also, if it is true that a) Summly got a better deal than Yahoo! could've; and b) that those terms were transferrable in the case of a change of ownership ... well, some poor dumb bastard at SRI legal is probably having a very bad month.
nilkn 14y ago
I'm confused on how summly would have gotten a better licensing deal than Yahoo! could have managed. [Honest question.]
- kd0amg 14y ago
  Plain old price discrimination? I wouldn't expect SRI to try to get a Yahoo-sized license fee out of some tiny startup.
  - jeffgreco 14y ago
    Sure, but would a tiny startup get exclusive rights?
- sks 14y ago
  Maybe they got an exclusive license when yahoo wasn't event remotely interested in the tech. Just a guess.
gojomo 14y ago
Reading between the lines, I'm guessing Yahoo really liked the SRI tech (perhaps also with some of the additions made by Summly). They wanted to exclusively lock it up. If Yahoo had gone just to SRI, a competitor could have bought Summly... and Summly may have had, as part of SRI's stake, a perpetual and transferable license that Yahoo didn't want falling into any other acquirer's hands.

theatraine 14y ago

I would be interested to see the Summly summarization of this article! I think it would read something like this: Yahoo bought Summly, a startup with an app that not many people used, made no money, and employed no technical geniuses (since it wasn't actually built by them), because Marissa Mayer believes summarization technology is "going to be huge for Yahoo".

runnr_az 14y ago
Yeah... I guess? Doesn't really help it make sense....
- harlanlewis 14y ago
  I believe that is exactly the point.

michaelochurch 14y ago

Further, D'Aloisio deserves credit for outsourcing technology development and app development to the right firms, and coalescing their work into a product that made him millions. I can't tell if this is a brilliant dog-whistle dig or if it's actually being said without irony.

Hitchhiker 14y ago
I am afraid, its being said without irony.
eli 14y ago
I don't think it's ironic. I also don't think managing and coordinating multiple outsourced developers is at all trivial. (Though, true, it's probably not worth millions either.)
- UK-AL 14y ago
  Yes, but somo isn't some cheap outsourcing company. They will completely design your app, and then develop it for you. Its isn't a company where you manage a group of contracted coders.
  - eli 14y ago
    Fair enough. I don't know anything about them. I think my point, in a roundabout way, is that for many/most startups the actual writing of lines of code is not the hard part. At least, that's what I've found to be the case. If you can successfully outsource that task, more power to you.
    - rkuykendall-com 14y ago
      Kevin Rose paid someone a fixed amount to write Digg, and then paid other people salaries to continue writing it. Writing code is not the most important part of most businesses, excluding the few which are built on an emerging technology. Facebook, Amazon, HackerNews, Reddit, Wikipedia, Twitter, none of these would be hard services to get to 1.0 for any halfway decent programmer. But somebody had to know what to build, they had to believe in it, and they had to work for it, to learn from their mistaks and flush out the vision. And most of these people probably paid somebody else to write most of the code.

fnbr 14y ago

Are there sources for the $30 million? I've only seen it mentioned in secondary sources, never in an official Yahoo press release (or similar). I suspect that was leaked, and the real price was much lower.

securingsincity 14y ago

I actually stopped reading Gizmodo because i thought the article where they made him cry a few years back was too far. Shaming a 15 year old kid publicly no matter how annoying seemed too far. Now he successfully gets summly acquired and the support for and shade that has been thrown at this kid has been so massive. I still don't know what to think of the kid, but I do think that SRI's tech definitely meets the needs of Yahoo and would fit perfectly with their media content.

UK-AL 14y ago
I don't like how they treated him. However I think it does expose the difference between media reporting(tech genius,visionary, future leader, hard working) and actual reality(Narcissistic, child like, unprofessional). And those traits have been exposed again, since he claimed to invent the tech and developed the app in the media. Media have hailed shower of praises, mainly because he uses a top PR agency. Its kind of depressing for me, because it seems to mean being showy, and having a good PR facade is worth far more than people doing the actual work.
- badgar 14y ago
  > Its kind of depressing for me, because it seems to mean being showy, and having a good PR facade is worth far more than people doing the actual work. Marketing is a huge part of the startup world. There's a reason people are told to stop building at MVP - what you build isn't really important, and you're really likely to throw away what you built and switch to something else.
  - deleted 14y ago
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bsimpson 14y ago

I just read the whole article, and I still don't know why Yahoo! bought Summly.

spoiler 14y ago
I guess it has something to do with IP. The way I understood it was that the company Summly licenced the summarisation algorithm was selling it to Yahoo!, but they couldn't do that because Summly was using it, too. So, to get them out of the way, Yahoo! bought them and shut them down. Disclaimer: This is just the way I understood it, I might be partially or completely wrong.
- bsimpson 14y ago
  That's my gist as well, but for an article with such a bold title, it doesn't really say much.
- dhaivatpandya 14y ago
  That doesn't make much sense - as far as I understand, so far as the US, you cannot patent or hold a license over an algorithm, only an implementation thereof.
  - LucasCollecchia 14y ago
    Yes, but if the algorithm is a trade secret and you're licensing it out with terms of use that aren't favorable to you, you may determine that its in your best interest to buy the company rather than get sued for breach of the licensing contract depending on how much cash you're anticipating to lose through that litigation.
signalsignal 14y ago
It was insider dealing involving a minor who's family has very powerful connections.

algosio 14y ago

The Sad Part is they could actually be out buying companies like http://www.algorithms.io http://www.algorithms.io

googoobaby 14y ago
The developers probably don't have the pedigree that Marissa demands.

jgalt212 14y ago

Perhaps Yahoo saw some positive benefit in paying off Summly's coterie of celebrity investors and advisers. http://summly.com/about.html http://summly.com/about.html

el_fuser 14y ago
Wow... That reads like a poster for the slogan "it's not what you know, it's who you know".

mindcrime 14y ago

Dear Marissa: The next logical step for Yahoo! is to move into the enterprise. I know a great startup you could acquire that would accelerate your move into that space. I expect it could be had for somewhere around what you paid for Summly. Call me. Mindcrime

mgkimsal 14y ago
usually helps to put a phone number if you're expecting a call.
- mindcrime 14y ago
  It's in my profile. :-)

jahansafd 14y ago

Very few people invent anything. Most developers with limited resources work with groundbreaking technologies(built by others) to create something meaningful.

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bonjourmr 14y ago

Everyone around the world was saying 'Yahoo' a fortnight ago for the first time in a long time because of this purchase of summly and coincidentally, Yahoo also quietly became the default search in Safari for iPhones during March. I like to think this is all great marketing and survival positioning by Yahoo as the big 3 companies/partnerships (read on) rear up for an exciting next few years in technology. Why would Apple change the default search? Well Apple and Google are the main rivals in the mobile market, it makes sense for both Apple to choose an alternative default search engine, as they don't want to strengthen their main rival. I also think Apple's recent 'interest' in robotics (Siri, hiring ex-segway engineer) v.s. Google's robotic cars & Glass, this will be another front that Apple will have to fight Google on. "1 Billion People Will Use Mobile As Primary Internet Access Point In 2012" http://googlemobileads.blogspot.com.au/2012/02/consumers-love-their-smartphones-now.html http://googlemobileads.blogspot.com.au/2012/02/consumers-lov... That leaves them with two options, the first being Bing. No way in hell would they choose Microsoft to partner with, with MS' purchase of Skype and close ties with FB you can expect MS to push harder than ever in the Mobile space, over the next few years (assuming they can tie all of their products together neatly). So that really only leaves Yahoo for search, which works out well for both companies; Yahoo get to survive the battle of the big 3 and still appear somewhat relevant and Apple are no longer strengthening their main rival. I really have no idea what I'm talking about but it sounds interesting. tl;dr - purchase of summly was marketing and survival by Yahoo

Me1000 14y ago
Google is still the default search engine on the iPhone. They just removed the "google" button and replaced it with "Search"

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ksherlock 14y ago

Maybe this was edited in later (I missed it the first time), but... >Though Summly's own Web site once said: "SRI International, with the help of the Summly team, built the summarization technology behind Summly," we are told that D'Aloisio "invented" the product's original technology. >In a statement provided to us by a Yahoo spokesperson, an SRI spokesperson says: "Basically, Nick developed the original code for Summly." >"After the original product was built, SRI supported development of the technology and provided artificial intelligence expertise in machine learning and natural language processing." I don't know about you, but I need a pretty large grain of salt. http://www.youtube.com/watch?v=Y11ps1H6Aq4 http://www.youtube.com/watch?v=Y11ps1H6Aq4 is a youtube demo of his first app, trimit, 9 months and $300,000 in VC before summly. It seems 2 comprez ur mezages like this. Maybe that's the original code.

eridius 14y ago
At the 1 minute mark he says "some other.. form.. of documentation.. which I don't know what that is". So either he misspoke, or he didn't actually even develop that original app.
- dangero 14y ago
  The video isn't made by the Summly founder. It's just a random person reviewing the app.
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podperson 14y ago

I used automatic summarization to try to reduce the article to a pithy tweet and ended up with: "Fuck, I don't know. And what's with Bezos investing in BusinessInsider? And what is Amazon's business plan anyway? And why does Apple's stock keep dropping whenever it gains market share?"

OGinparadise 14y ago
And what's with Bezos investing in BusinessInsider? For peanuts they more or less buy good coverage in a widely read news site. A certain VC fund also invested in them and PandoDaily. It's a great investment, even if Business Insider goes kaput 2 years from now.

brudgers 14y ago

To the degree Summly's license to the technology was transferable, the purchase makes a lot of sense because it prevents strategic acquisition of Summly by a potential Yahoo competitor. Even if not transferable, the purchase prevents Summly from partnering with a Yahoo competitor, and that is very likely to have been allowed by Summly's license. With nearly $4 billion in net income last year, the purported purchase price is less than a penny to the dollar.

spdy 14y ago

It´s a strategic investment to make people invested in Summly happy. http://summly.com/about.html http://summly.com/about.html Their will be follow ups and some of them might lean towards Yahoo on the next acquisition.

notlisted 14y ago
My thoughts exactly. The 17MM was a 'cheap' way to save face for big-name investors and "celebrities" who'd been duped. Circle-jerk money. "Angel Investors and Advisors include; Ashton Kutcher, Betaworks, Brian Chesky, Hosain Rahman, Jessica Powell, Joanna Shields, Josh Kushner, Mark Pincus, Matt Mullenweg, Seb Bishop, Shakil Khan, Spencer Hyman, Stephen Fry, Troy Carter, Vivi Nevo, Yoko Ono and many more. We are also working closely with News Corporation on the summarization of their content." Edit: actually, reading all of the comments on this page, I think my explanation is less likely than the "summly may have had a special license, and SRI couldn't be sold unless summly was acquired as well" (without resulting in lawsuits or sub-licensing deals) and/or "a nice way to pay more for SRI via the backdoor" (artificially increasing the value of the summly stock they held -> more $$ for SRI). Do we know how much stock SRI owned of the company? Perhaps they provided services in exchange for summly shares? Wouldn't be the first time.

fauldsh 14y ago

I'm getting increasingly intrigued to how much advertising they're getting for their $30m

jasonkester 14y ago

You know, I think I prefer to live in a world where giant tech companies occasionally act in strange, irrational ways that result in random people getting multi-million dollar windfalls. Especially if said people vaguely resemble, well, me. That being, entrepreneurial software folk running companies with trivially buildable products. That's the sort of person in my mind that should have as many foolish megacorporations as possible stumbling over one another to randomly dump tens of millions of dollars in cash upon them. Given the alternative world, where all companies behave rationally at all times and nobody ever makes mistakes that could possibly make, say, me a gozillionaire overnight, I think I'll keep living in this world. Keep up the good work, Yahoo! [Disclaimer: I own a small pile Yahoo stock (that made me a bunch of money in the 90's and has been taking it steadily back ever since), so I probably lost a few hundred dollars because of this particular deal. I'm happy to pay it, much as people who buy lottery tickets are happy to pay it. Having a crazy, aquisition-happy company out there doing its thing is more than worth the price]

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macspoofing 14y ago
>You know, I think I prefer to live in a world where giant tech companies occasionally act in strange, irrational ways that result in random people getting multi-million dollar windfalls. You're in luck, that happens all the time with executive compensation packages.

biswajitsharma 14y ago

Now about that Kid, D'Alosio ... I don't care he built it or not, he made money like a crazy chicken!! I think that's enough!! :) Coming back to Yahoo! I believe Marissa Mayer has something in mind. She is a smart lady, smart enough to point out what we are pointing out here. If not, we'll soon see another JC Penney episode here.

ig1 14y ago

Flagged. This article contains zero new information and just speculation. Unless you were involved in the transaction you have no idea what was involved. Maybe they overpaid and maybe they didn't. If you believe Yahoo are stupid you're free to go and short Yahoo shares. They are after all a publicly traded company. Lets stop with all this stupid speculation where people rehash the small amount of public information for the purpose of linkbait.

louischatriot 14y ago

It's great to get some insight on a deal that, frankly, I couldn't understand. I am of course biased, because I believe (like many others) that algorithms are bad at summarization, except for already well-structured content (news are usually like this). That includes most blogposts and videos. My startup (tldr.io) is trying to actually solve the summarization problem using crowdsourcing. For example, here is the summary of this article: https://tldr.io/tldrs/516542c52dcbc1ab3b0000d2/heres-the-real-reason-marissa-mayer-bought-a-17-year-olds-startup-for-30-million https://tldr.io/tldrs/516542c52dcbc1ab3b0000d2/heres-the-rea...

fosterzone 14y ago

Well curated article Thanks

LandoCalrissian 14y ago

My question then, is why didn't Yahoo just try and work with SRI International directly and not deal with Summly?