Mouse ears for Jerry Yang? I don't think so.
Madrona Venture Group's Matt McIlwain is predicting that Disney
"I actually think the most logical buyer is Disney," McIlwain said last night, during the Washington Technology Industry Association's annual predictions dinner. "And the rationale is that Yahoo! for the last six to eight years has focused hard on being a content company and a manager and leverager of content assets." Panel moderator John Cook from TechFlash provided the quotes on his blog.
To be fair, McIlwain initially joked that no one should buy Yahoo! He also made his comments in a setting where you seem to score as many points for being quotably outlandish as you do for being correct.
However, since this is the kind of chatter that is quickly spun into bogus buyout buzz, let's shoot this one down before it leaves Fantasyland.
There are several reasons why this is highly unlikely to happen.
1. Buying Yahoo! was Michael Eisner's idea
If this Mickey Mouse prediction has any kind of legs, it will be because Disney in fact once explored the purchase of Yahoo!. During the sudsy dot-com bubble days, a Disney-Yahoo! hookup was supposed to follow the Time Warner
The hang up, naturally, was price.
"It's a great company," former CEO Michael Eisner told BusinessWeek in February of 2001. "It is just too expensive. It's certainly too expensive at $125 billion. Maybe it would be too expensive at $50 billion, maybe even at $25 billion. But it is a great company."
If price is a factor, Yahoo! is obviously trading well below that preposterous $125 billion ransom. It's also a much larger company today. However, a few important things to consider:
- Eisner is no longer with Disney.
- Disney's purchase of GO.com at the time didn't exactly pan out.
- These days, media companies are doing just fine in attracting Web audiences.
In a nutshell, current CEO Bob Iger isn't going to chase Eisner's dreams for the sake of continuity.
2. Yahoo! is too big
Sometimes a media giant gets lucky, like when News Corp.
After watching Microsoft's
3. Don't snort the pixie dust
Disney isn't a saint. How can it be? However, if you think critics like to take whacks at the company whenever a Vanity Fair photo shoot goes too far or when an "R" rated movie steams up the multiplex, just imagine how those protests will grow with Yahoo!.
Can you picture Disney watching over a dating classifieds website or trying to filter the content going through Yahoo! email or newsgroups? It won't work.
4. Disney doesn't need new enemies
Disney is the undisputed champ of family entertainment. Does it really want to enter into a race where it would be a distant silver medalist to Google
Even if you drool over the prospects of marketing theme park vacations or DVD releases to the 250 million Yahoo! Mail accounts or persuading ABC and ESPN advertisers to spend more on wider online campaigns, what's the point? Disney wanted Yahoo! several years ago, when it was the best.
The world needs a Disney-Yahoo! hookup in the same way that it swallowed Time Warner and America Online.
It's not going to happen. It may not win me any style points, but now you know where to send the invite for next year's predictions dinner.
Some other articles to read before deciding what Yahoo! is really worth: