10 most successful online acquisitions
Well, the article "10 most unsuccessful acquisitions in the Internet sphere" caused a heated discussion. It is logical that the reasoning on whether the acquisition turned out to be successful or not causes a lot of controversy, but the purpose of such lists is, first of all, for the managers of the companies to think before “getting involved” in another deal.
The compilation of my (I’ll note at once - completely subjective) list of the best acquisitions in the Internet sphere took much longer. Perhaps this is due to the fact that the "overall quality" of transactions over the past 10 years is still at a high level. So, here is my opinion:
10. Shopzilla - acquired by Scripps in June 2005 for $ 525 million. This is a rather rare example of how the purchase of an “offline” Internet service company had a positive effect on both sides of the transaction. Shopzilla is a service for comparing prices in online stores, and embedding the Scripps advertiser base into it made it not only more convenient, but also profitable. Over the past year and a half, Shopzilla’s profits have doubled.
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9. Network Solutions - acquired by SAIC in 1995 for $ 4.5 million. This acquisition did not change the company's strategy and did not affect its position in the market. It just brought income. SAIC acquired a domain registrar for a frivolous amount, and in 2000 it sold it to VeriSign for ... (drum roll) $ 21 billion!
8. YouTube - acquired by Google this year for $ 1.65 billion. Heard about it, right? :-) This is not an ordinary purchase - and it probably would have been included in the list of 10 unsuccessful purchases, but what makes it successful is video advertising. The next stage in the development of advertising on the Internet will undoubtedly be precisely this type - and it will be much more profitable for Google than the current contextual banners and text links. Google Video was not a leader in its field - and YouTube is leading. If this acquisition really helps Google to become the leader of video advertising, it will pay for itself many times.
7. ZiffDavis - acquired by CNET in 2000 for $ 1.6 billion. ZiffDavis was the parent company of ZDNet - at that time a serious competitor to CNET. Since the acquisition of ZDNet, in my opinion, it is clearly “blown away” and repositioned - but why is this purchase in Top10? It’s just that CNET managed to stop a competitor in one fell swoop and gain a foothold in serious positions in the field of IT information. Imagine what it would be like if then ZDNet was bought by Yahoo.
6. Overture - acquired by Yahoo in July 2003 for $ 1.63 billion. Yahoo was able to quickly draw conclusions from Google’s acquisition of Applied Semantics (see below). At that time, Overture brought Yahoo 20% of its profits - and I can imagine how these figures have grown over the past 3 years. Although Panama is being developed to replace Overture, this purchase has allowed Yahoo not to lose to the search market.
5. Advertising.com - acquired by AOL in June 2004 for $ 435 million. At AOL they realized that it was not the right direction to remain a closed network and only access to the Internet. The acquisition of Advertising.com, an online advertising firm, became the backbone of AOL's advertising business, thanks to which the company was able to get rid of its dependence on revenue in the field of Internet access. AOL's excellent financial performance in the last quarter suggests that it was a great solution.
4. Four11 - acquired by Yahoo in 1997 for $ 92 million. The Four11-owned Rocketmail service turned into Yahoo Mail - and Yahoo.com was one of the first portals to offer a free email service. Despite the acquisition of Hotmail by Microsoft later that year, Yahoo did an excellent job of integrating the email service with the rest of its products. For less than $ 100 million, Yahoo was able to overtake many of its competitors who created their portals, and created a service that is trusted by millions of users.
3. Applied Semantics - acquired by Google in April 2003. Applied Semantics has created Adsense technology, which displays text-based ads on the pages of sites. This acquisition has become the basis of current domination - and Google’s huge revenues. Before that, Google was just a search engine, after this purchase it became a search engine that brings in money.
2. PayPal - acquired by eBay in 2002 for $ 1.5 billion. This purchase significantly affected the growth of the company. After unsuccessful attempts to compete with PayPal and create their own payment system in eBay, they realized that it was too late and PayPal became the most used payment system in most eBay auctions. And the company decided to obey its users. Now PayPal is fully integrated into the auction system and brings excellent income.
1. MySpace - acquired by News Corp. in July 2005, for $ 580 million. Of course, someday MySpace will be remembered as just a collection of ugly web pages, but the acquisition of Intermix - the owner of MySpace - made News Corp. one of the leaders in online business. Despite negative predictions at the time, MySpace continues to grow like crazy. This service gave News Corp. an excellent platform for promoting music, video - and in general all that can be offered to a huge audience of young people. No wonder News Corp. brags about the fact that now MySpace is 10 times more than the amount paid for it.
As in any other similar list, there are several applicants who almost fell short of getting into it (as, for example, the AOL company that bought Mirabilis). However, the purpose of this Top10 - to cause a discussion, and not to convey to someone the official point of view. So go ahead, tell me what I missed or what you agree with!
The compilation of my (I’ll note at once - completely subjective) list of the best acquisitions in the Internet sphere took much longer. Perhaps this is due to the fact that the "overall quality" of transactions over the past 10 years is still at a high level. So, here is my opinion:
10. Shopzilla - acquired by Scripps in June 2005 for $ 525 million. This is a rather rare example of how the purchase of an “offline” Internet service company had a positive effect on both sides of the transaction. Shopzilla is a service for comparing prices in online stores, and embedding the Scripps advertiser base into it made it not only more convenient, but also profitable. Over the past year and a half, Shopzilla’s profits have doubled.
')
9. Network Solutions - acquired by SAIC in 1995 for $ 4.5 million. This acquisition did not change the company's strategy and did not affect its position in the market. It just brought income. SAIC acquired a domain registrar for a frivolous amount, and in 2000 it sold it to VeriSign for ... (drum roll) $ 21 billion!
8. YouTube - acquired by Google this year for $ 1.65 billion. Heard about it, right? :-) This is not an ordinary purchase - and it probably would have been included in the list of 10 unsuccessful purchases, but what makes it successful is video advertising. The next stage in the development of advertising on the Internet will undoubtedly be precisely this type - and it will be much more profitable for Google than the current contextual banners and text links. Google Video was not a leader in its field - and YouTube is leading. If this acquisition really helps Google to become the leader of video advertising, it will pay for itself many times.
7. ZiffDavis - acquired by CNET in 2000 for $ 1.6 billion. ZiffDavis was the parent company of ZDNet - at that time a serious competitor to CNET. Since the acquisition of ZDNet, in my opinion, it is clearly “blown away” and repositioned - but why is this purchase in Top10? It’s just that CNET managed to stop a competitor in one fell swoop and gain a foothold in serious positions in the field of IT information. Imagine what it would be like if then ZDNet was bought by Yahoo.
6. Overture - acquired by Yahoo in July 2003 for $ 1.63 billion. Yahoo was able to quickly draw conclusions from Google’s acquisition of Applied Semantics (see below). At that time, Overture brought Yahoo 20% of its profits - and I can imagine how these figures have grown over the past 3 years. Although Panama is being developed to replace Overture, this purchase has allowed Yahoo not to lose to the search market.
5. Advertising.com - acquired by AOL in June 2004 for $ 435 million. At AOL they realized that it was not the right direction to remain a closed network and only access to the Internet. The acquisition of Advertising.com, an online advertising firm, became the backbone of AOL's advertising business, thanks to which the company was able to get rid of its dependence on revenue in the field of Internet access. AOL's excellent financial performance in the last quarter suggests that it was a great solution.
4. Four11 - acquired by Yahoo in 1997 for $ 92 million. The Four11-owned Rocketmail service turned into Yahoo Mail - and Yahoo.com was one of the first portals to offer a free email service. Despite the acquisition of Hotmail by Microsoft later that year, Yahoo did an excellent job of integrating the email service with the rest of its products. For less than $ 100 million, Yahoo was able to overtake many of its competitors who created their portals, and created a service that is trusted by millions of users.
3. Applied Semantics - acquired by Google in April 2003. Applied Semantics has created Adsense technology, which displays text-based ads on the pages of sites. This acquisition has become the basis of current domination - and Google’s huge revenues. Before that, Google was just a search engine, after this purchase it became a search engine that brings in money.
2. PayPal - acquired by eBay in 2002 for $ 1.5 billion. This purchase significantly affected the growth of the company. After unsuccessful attempts to compete with PayPal and create their own payment system in eBay, they realized that it was too late and PayPal became the most used payment system in most eBay auctions. And the company decided to obey its users. Now PayPal is fully integrated into the auction system and brings excellent income.
1. MySpace - acquired by News Corp. in July 2005, for $ 580 million. Of course, someday MySpace will be remembered as just a collection of ugly web pages, but the acquisition of Intermix - the owner of MySpace - made News Corp. one of the leaders in online business. Despite negative predictions at the time, MySpace continues to grow like crazy. This service gave News Corp. an excellent platform for promoting music, video - and in general all that can be offered to a huge audience of young people. No wonder News Corp. brags about the fact that now MySpace is 10 times more than the amount paid for it.
As in any other similar list, there are several applicants who almost fell short of getting into it (as, for example, the AOL company that bought Mirabilis). However, the purpose of this Top10 - to cause a discussion, and not to convey to someone the official point of view. So go ahead, tell me what I missed or what you agree with!
about the author
James Nicholson is one of the founders of NetVentures, bought by CNET in 1999. Subsequently, he held a management position at CNET. In 2001, he “moved away from network business,” traveled the world, opened an art gallery. He lives in New York. Currently working on a new network project.
Source: https://habr.com/ru/post/30875/
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