A few days ago I opined on the overdue demise of Google+, a social network that was essentially DOA, yet somehow continued to haunt us for years like an old pet odor we cannot get out of the carpet.
But that pales in comparison to the obvious blunder surrounding Verizon’s purchase of AOL and Yahoo, among other assets, for nearly $10 billion, and then writing it down by about 50% this week. Should this be a surprise? No. Remember in 2000, AOL actually merged/bought Time Warner to create essentially the largest media company at the time for about $160 billion. It has been called the worst business deal ever.
Media companies are fickle little things, aren’t they? They live and die by advertising and partnerships. But if interests change, can companies evolve? Verizon continues to struggle in its effort to build its publishing empire and tried to catch two falling knives in AOL and Yahoo. Perhaps it was blindsided by micro-successes such as Huffington Post (owned by AOL).
Seems like the sellers are always the ones that make out in the M&A world of publishers. So next time you’re on the buy side, just remember, Verizon wasn’t the first one to buy AOL. And it probably won’t be the last.
