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Verizon Sells AOL and Yahoo to Apollo for $5B

nytimes.com

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Re: Verizon Sells AOL and Yahoo to Apollo for $5B

#341

Post by sellyme »

sjg007 wrote: post #330
sellyme wrote: post #319

Earlier quoted context omitted.

> Would you buy AOL and Yahoo for $5? Absolutely. I'd then sell Yahoo's Finance and Fantasy Sports divisions off for a couple billion dollars profit, and try to flip the rest of Yahoo at a pawn shop so I'm not stuck with that absolutely cursed company.

As fun as your comment is, it literally doesn’t add anything to the conversation. The question is why buy at all.. your argument is that the parts are worth more than the whole. Is that all the thesis is?

> your argument is that the parts are worth more than the whole. Is that all the thesis is?

Yes. Just about everyone on the planet is aware that Yahoo is a cursed company that you should stay extremely far away from, but if you look exclusively at the two divisions it does well in (three if you include Japan, which you shouldn't as it's basically a separate company) then they're actually totally competent and profitable systems, which would justify this price tag on their own quite handily.

Given the recent Yahoo! Answers news, it seems like Apollo is thinking along the same lines, and are only interested in the good bits of this acquisition.

Re: Verizon Sells AOL and Yahoo to Apollo for $5B

#342

Post by 55555 »

andrewprock wrote: post #335
TaupeRanger wrote: post #299

Earlier quoted context omitted.

Tell that to investors in Fitbit or Palantir (for example) before they sold off after having good "momentum". Crypto investors don't even understand crypto, but that doesn't mean anything, because you can be left holding a long term bag whether you understand the underlying asset or not.

If you actually understand a "momentum" asset, you will definitely not be left holding the bag.

Please elaborate?

Re: Verizon Sells AOL and Yahoo to Apollo for $5B

#343

Post by blihp »

nl wrote: post #315
blihp wrote: post #222

Earlier quoted context omitted.

In other words, the greater fool theory.

No, the opposite. The value of a company in a fair market is a function of the confidence of investors that someone in the future will pay more for the same stock. For a highly profitable company like Facebook, this isn't a foolish confidence in anyway. Even if you don't like Facebook it would be a very radical position to take to think that their profits next quarter will be remarkably lower than this quarter. In gr…

Thinking like that is what drove AOL and Yahoo! to their peak valuations. It's not that the companies didn't produce something of value and have some level of earnings, it's that their stocks priced in a fantasy land future that could never be achieved. At some point, there will not be someone willing to pay more, or even the same amount, for the stock.

When you are counting on the 'confidence' of future investors to (over)pay more than you did for something, rather than any rational valuation, you are quite literally counting on a greater fool[1] being willing to buy it from you.

[1] https://en.wikipedia.org/wiki/Greater_fool_theory - note that it isn't always about an asset having no value, just that for an overpriced asset that there will be someone else willing to pay more for it.

Re: Verizon Sells AOL and Yahoo to Apollo for $5B

#344

Post by blihp »

berkes wrote: post #241
blihp wrote: post #222

Earlier quoted context omitted.

In other words, the greater fool theory.

Not really. The crucial piece is the future profit.

Right, but notice that wasn't the emphasis of the post I was responding to. OK, there was 1/2 a sentence that touched on profits as almost an afterthought.

The thing that sets me off about these threads is the (I believe sincere) thinking that 'well if that's the share price, it must be worth that much'. That's fine if you're speculating/trading but is absolutely wrong if you think what you're doing is investing.

Re: Verizon Sells AOL and Yahoo to Apollo for $5B

#345

Post by pm90 »

gorbachev wrote: post #266
perardi wrote: post #9

From the article: …“it agreed to sell Yahoo and AOL to the private equity firm Apollo Global Management for $5 billion.” They apparently paid $4.4 billion for AOL, and Yahoo they got for $4.48 billion. I have to say: only losing $5 billion while handling the decaying corpses of AOL and Yahoo is, weirdly, kind of a triumph. These are cursed properties, and bring only despair. Though I’m surprised they didn’t try to ke…

I don't get how Apollo thinks they can make a profit from these zombie companies. How long has it been since an acquisition of either one of those companies made the acquirer any money? More than a decade?

Apollo can be thought of as garbage disposal for tech companies.

They provide enough capital for a corporation to keep running while systematically stripping it down until only the most profitable core remains, then re-IPO'ing that husk of the company. Along the way, they make the most use of financialization to extract as much benefits as they can.

They serve a purpose in the ecosystem I guess. Its better than the company devolving into irrelevance or collapsing at once. Graceful termination means that everyone can wait for a ferry to take them away rather than jump ship.

Re: Verizon Sells AOL and Yahoo to Apollo for $5B

#346

Post by rasz »

js2 wrote: post #192

> For Apollo, it’s an opportunity to further invest in the digital media space — an industry it has already put money behind with deals for Shutterfly, Rackspace and Cox Media. Cox Media was my first employer (it was called Cox Interactive Media at the time), Verizon Media, my current employer. At the time, I was on the team that ran CIM's web farm which hosted the web presence for all of Cox Enterprises' newspapers,…

>I recall seeing a bunch of exposed motherboards mounted in racks on simple trays. It was an early Google presence:

sidenote: Despite the appearance those werent random consumer motherboards. Supermicro P6SBM.

Re: Verizon Sells AOL and Yahoo to Apollo for $5B

#347

Post by nly »

ErikVandeWater wrote: post #284
throwaway3699 wrote: post #171

Earlier quoted context omitted.

Just FYI, 'conservative investors' do understand crypto, they just think it's a bad investment.

I would say 95% of investors don't understand crypto, whether they have high or low risk tolerance. But high risk tolerance investors are more likely to invest in something that has momentum without understanding the fundamentals. Betting with the momentum is often a good strategy.

"Momentum" is bullshit reasoning to buy anything as volatile as crypto. The only reason investors struggle with crypto is because it has no "fundamentals" to analyze.

Re: Verizon Sells AOL and Yahoo to Apollo for $5B

#348

Post by williamtwild »

throwaway3699 wrote: post #171
dcolkitt wrote: post #144

Earlier quoted context omitted.

My off the wall suggestion would be for Coinbase to acquire them. They certainly have enough firepower to do a stock acquisition. The Yahoo Finance portal would run as a subsidized loss leader to on-ramp new customers into crypto investing. Setting up the portal to put crypto assets on the same footing as traditional assets would do a lot to appeal to older or more conservative investors who view crypto as "magic Int…

Just FYI, 'conservative investors' do understand crypto, they just think it's a bad investment.

A good number of them think the covid vacciene has micro chip tracking and you want me to beleive they understand crypto?

Re: Verizon Sells AOL and Yahoo to Apollo for $5B

#349

Post by KirillPanov »

ajmurmann wrote: post #259
mohanmcgeek wrote: post #175

Earlier quoted context omitted.

Or makes them worse by "developing" them Eg: Google Chrome on Android

I really wish there was incentive to have products be "done". It seems that so many products get to a great state and then get made worse over time because we need continuous growth (Evernote immediately comes to mind. Others seem to feel similar about 1Password) or in the case of Google, get shut down.

> I really wish there was incentive to have products be "done".

Easy, just use version numbers which asymptotically approach an irrational number, like Knuth's TeX (currently at version 3.14159...ish)

But seriously, the incentive to be "done" is when a lot of other software relies on your API or file format. This is why mozillans throw such a tantrum whenever anybody tries to use their rendering engine as part of some other piece of software. Getting to "done" isn't fun.

Re: Verizon Sells AOL and Yahoo to Apollo for $5B

#350

Post by KirillPanov »

ksec wrote: post #89

A headline with 5G but not a single mention of it in the article. If any insider from Verizon may be could help explain why their insistence on mmWave 5G for Phones. ( And Phone only, not fixed Wireless internet access ) It doesn't make sense to me when the spec (3GPP) were announced, doesn't make sense when Verizon actually announced it, and still doesn't make any sense when they are now up and running. Both from a…

> A headline with 5G but not a single mention of it in the article.

Because: https://news.ycombinator.com/item?id=27035599

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