This article was reprinted from @Wanke Weekly. Dr. Wu Jun wrote an article to interpret the Yahoo! sale. Dr. Wu Jun graduated from Tsinghua University and Johns Hopkins University. He is an expert in natural language processing and search. He is one of Google’s early employees and has won the Google Engineering Award. He once served as Tencent’s vice president and is now a Silicon Valley venture capitalist. At the same time, he is the author of "The Tide of Waves," "The Beauty of Mathematics," "Light of Civilization," and "The Road to University."
Yahoo! has finally been sold!
Yahoo is no stranger to Internet users who started surfing the Internet in the 1990s. It was a synonym for the Internet. The once largest global Internet company, when the Internet bubble reached its peak in early 2001, had a market value of about $120 billion. Today, after a period of loss, under the pressure of investors, it had to sell its main business to telecom giant Verizon and sold only 4.8 billion U.S. dollars. Although I told Yahoo in the first edition of "Inspur No. 1" many years ago, it is said that as an independent company, it may cease to exist in the near future, but when this day really comes, as a With Yahoo's more than two decades of old users, I still have a lot of emotion.
Is Yahoo selling cheap?Before commenting on Yahoo's acquisition, we must first correct some misunderstandings of many media and readers. That is, Yahoo was sold off, or that Yahoo had missed the best time to sell in the past few years because of the rivers and rivers. $ 44.6 billion to buy Yahoo). This misunderstanding may come from the misleading misinformation of the media title party, perhaps from the ignorance of some people.
First of all, it needs to be clarified that Yahoo's sale is only its main business plus the corresponding real estate (office building), not all assets. The assets of a large company usually include these parts:
Net cash assets (cash + customer payables - debt + credit limit)
The value of the business
Value of investment assets
real estate
Brand, intellectual property and other intangible assets
In general, the main value of Internet companies is reflected in the value of business operations and intangible assets. However, Yahoo's situation is different. It currently has nearly 40 billion U.S. dollars (about 39 billion U.S. dollars in stock price in July 2016) (mainly Alibaba and Yahoo Japan listed separately) and a net of 5 billion U.S. dollars. Cash assets, these constitute the bulk of Yahoo's assets.
In addition, its patents are also quite valuable. According to Microsoft's purchase of Canadian Nortel Corporation and Google’s purchase of Motorola patents, the value of these assets is at least US$1 billion. If you add this time to a $4.8 billion sale to Verizon's business and real estate, then today's Yahoo is worth about $50 billion, which is far from what many people think of "less than 5 billion US dollars", and even more than Microsoft opened that year. Out of the $44.6 billion (acquisition of Yahoo's entire assets) is much higher. If we take into account the failure of the last Microsoft acquisition, Yahoo's handler Lu Qi left the company to Microsoft, and then took away a large number of Yahoo elite. Yahoo's answer today is quite good.
Of course, if you measure the peak of 120 billion U.S. dollars in the 2001 Internet bubble, Yahoo's market value is indeed being smashed. However, Yahoo is already one of the best and longest-lived companies in the world for many Internet companies of that era. Netscape companies of the same age as Yahoo already no longer exist. When AOL, which once had a market value of more than 100 billion U.S. dollars, was finally sold to Verizon, it only sold more than 4 billion U.S. dollars (all assets). It has long been protected under Microsoft wings. MSN has never been profitable, and it is no one used today.
After Yahoo, China has created a number of Yahoo-like companies. Representatives are Sina, Netease, and Sohu. Today, their influence in China’s Internet is also declining, apart from NetEase’s profitability due to its well-established games, and the other two have been on the verge of losing profits and losses.
Not only was the internet company born in that era not so good today, it was the other IT companies that had been standing at the time of the Internet bubble boom. Not much better than Yahoo. Today, compared to the 2000 highs, Cisco's market value has fallen by more than 70%. Intel's decline has also been the same. The Suns have lost 90% when they were acquired, and telecommunications equipment companies that once benefited from the development of the Internet infrastructure. If Nortel, Lucent, etc. have long disappeared from people's perspective. Therefore, although Yahoo has obtained this end today, it has its own problems, but more importantly, the time that belongs to it is gone forever, or that wave of waves has passed.
From Internet 1.0 to Mobile InternetThe era of the birth of Yahoo (1994) We call it the era of Internet 1.0 today. At that time, the entire Internet was almost empty, so there was a chance to use the Internet to do anything. At the same time, because it is a blank space, any Internet company must do all things. This is the characteristic of that era.
In the Internet 1.0 era, a website (or Internet company) wants to get users and advertising revenue from traffic, it must do their own content, build their own IT services, their own way to spread, but also need to find their own advertisers. Therefore, Internet companies of that era have a common characteristic: they are media companies, IT companies, communication companies, and advertising companies.
Looking back today, these companies, known as portals, are actually quite unclear about their positioning. Some of their businesses are even contradictory to one another, which in turn leads to contradictions between the corresponding departments and conflicts between the company's management. In the early days, SINA Corp. “eliminated†the founder Wang Zhidong and others, and it actually reflected the conflict between positioning itself as a media company or a technology company. This positioning is not clear, it can be said that the Internet 1.0 company's inborn defects. Compared to other Internet 1.0 companies, Yahoo can be said to be doing the best, which is why it became synonymous with that era.
Another feature of the Internet 1.0 era is that Internet companies want to do business with the Internet, so the product lines of those large portals are incredibly long. Yahoo used to have very long product lines such as news (portal), finance, email, hotel ticket, e-commerce, search, video, recruitment, and instant messaging. The number of products was so large that users had to use search engines to search Yahoo's products first. Service, then I know which one to use. Similarly, the earlier Tencent also had the same characteristics, so that the entire industry felt its tentacles stretched too long. As the Internet has a lot of blank space for various businesses to get up early, the potential problems of barbaric enclosure and rough development are temporarily overshadowed by the rapid development of surface prosperity.
However, the information age is no longer a time to build an aircraft carrier and to enlarge and strengthen an enterprise and form the corporate consortium at the end of the 19th century. This era emphasizes the division of labor, emphasizing the use of special skills, and doing one thing well. After the Internet bubble bursts, the Internet industry has gradually entered the 2.0 era. The essential characteristics of this era are expressed in terms of the media industry as "separation between production and broadcasting," that is, the production of Internet content (people and companies), and the provision of the Internet. The service (platform company) separates, the former concentrates on doing the content well, and the latter does the service well.
Today, the world’s two largest Internet companies, Google and Facebook, actually do not own any content. They are actually only channels for distributing content and Internet services. Facebook's success is not merely as a social network—social networking has long existed, but as an Internet 2.0 platform, where users and software practitioners can freely distribute their own content and software platforms.
Usually, an era will create a company that belongs to its own time, not a company that continues to make progress in the previous era . This has already been described in the genetic determinism of "The Tide of the Wave", and it will not be repeated here. In the Internet 2.0 era, most of the first-generation companies were left behind. Even though Google acquired Internet 2.0 companies such as Blogger and YouTube very early on, it was still squeezed by the more thorough Internet 2.0 companies. Tencent also faced a crisis in the era of transition, and its intense competition with 360 and Sina Weibo occurred at that time. Not the previous generation of companies did not do well, but the result of the natural selection of the times.
The second takeoff of Google and Tencent was fortunate enough to catch up with the new wave of Internet, the mobile Internet or Internet 3.0. Google, which owns the Android operating system, controls the mobile Internet to a large extent, so that it has regained its advantages in competition with Facebook, and Facebook has acquired Instagram and Whatsapp (can be seen as an international version of WeChat), etc. Mobile Internet companies are regarded as catching up with the wave of the Internet in this 3.0 era. Similarly, Tencent’s long-distance gap with other game companies (Tengxun’s main revenue comes from games) is largely due to WeChat’s product.
In 2014, when Facebook acquired a Whatsapp company with only a hundred people for a high price of about 20 billion US dollars, everyone exclaimed whether the price was too high. However, we must know that if Tencent does not have WeChat, its market value of US$220 billion will be at least smashed, which means that Whatsapp is much cheaper than WeChat. Facebook must pay this price, which is the entrance fee it needs to pay for the mobile Internet era. Similarly, Alibaba insists on doing its own mobile phone when the outside world is generally not optimistic, but also because it needs to pay for entry fees in the new era.
In just over 20 years, the Internet has grown at a rapid rate, so that the boldest prophet more than 20 years ago did not imagine the prosperity of the Internet today. In this era of rapid development, new great companies will continue to be made, and those once great companies will be announced. Like Google or Tencent, after almost missing the Internet 2.0 era, it is also a miracle to be able to catch up again in the 3.0 era. The ingredients of luck in this are much greater than the so-called managers. Yahoo did not have the luck of Google and Tencent. It was eliminated by the times, so it has been largely historically inevitable that this outcome is today.
Wall Street Cannot Give Yahoo DirectionIf it is absolutely necessary to find some of Yahoo's missteps in order to learn lessons in the future, then it will begin to have genetic problems, and this evil will gradually emerge.
Every company has its own gene. This gene is difficult to change, and the fate of the company has a lot to do with its genes. For instance, IBM, which serves large enterprises, is hard to make a personal computer such as a consumer-facing product. Microsoft, a traditional software company, is hard to make Internet services. It is no surprise that IBM missed the opportunity to lead the personal computer era and Microsoft missed the opportunity of the Internet era. The gene of a company, to a large extent, originates from the founder. Both Google and Baidu’s founders were engineers, so the two companies developed into technology-led companies; the founders of Tencent and Facebook are essentially product managers, so the two companies focus on the product experience; Amazon And the founders of Alibaba are businessmen, so the two companies are commercial driven.
We can hardly say that it is better to pay attention to engineering, product-oriented, and business-oriented features. However, it is better to have features than no features. Because when the company is in difficulty, it can find ways to use its strengths to the limit and focus all its strengths. Break the predicament at one point.
If a company's founders are weak, or lack a firm idea, then their influence on the company's genes will be relatively small, and the company will appear to have no characteristics. Unfortunately, the founders of Yahoo itself have no obvious features. Leading to Yahoo is such a featureless company.
As a Stanford doctoral student, Yahoo's Yang Zhiyuan and Philo were technically conscious. Philo himself even served as the first substitute for their system administrator, but compared to Google, Yahoo is not a good technology company. Because it does not believe that technology can be completely replaced by people, Google believes this. Yahoo is very concerned about the experience of the product, it is more to meet the user than Google, but it does not know how to lead users like Apple. In business, Yang Zhiyuan has geniusly discovered advertising as a business model for the Internet, but he and Philo are not good businessmen.
Yang Zhiyuan and Philo are very aware of their own shortcomings, so they used the textbook (and now the media) has been praised the practice - the introduction of professional managers. As early as before Yahoo went public (1995), it introduced the first CEO (Tim Koogle), and Yang Zhiyuan became the leader of Yahoo (Chief, and in some places call him the chief). Philo focused on engineering details. Therefore, Yahoo's genes did not form well at the beginning.
While introducing professional managers as CEOs, Yahoo has been largely controlled by capital. The initial control of Yahoo was a venture capitalist like Sun Jungheon. Fortunately, these people did not interfere in Yahoo’s business. However, after the listing, Wall Street capital seeking fast profits gradually took control of Yahoo, and Yahoo gradually turned its attention to Yahoo. Companies in the next fiscal year.
Before the Internet bubble burst, false prosperity masked Yahoo's problems. However, after the US economy fell in 2001 and the Internet bubble burst, Yahoo's problems began to appear.
During this period, Susan Decker from Wall Street helped Yahoo to turn a profit through her cost control method. However, the lack of technical experience of Decker made it impossible for Yahoo to accurately control the development of future technologies. Dekker is not even optimistic about Google’s future. He sold a large amount of Google’s shares held privately at a lower price than Google’s listing price (this part of the stock’s stake still holds more value than Yahoo’s sale of business and real estate to Verizon. The total price). At the same time, although the new CEO from the traditional media Samuel is committed to build a technology company, but because of lack of technology and lack of this ability, so in the two years after Google listing, he has been relying on the gradual sale of Google's stock Maintain the plausible financial statements until Google shares that can be sold are cautioned.
During this period, the number of stocks owned by Yang Zhiyuan and Philo has already accounted for less than 10% of Yahoo, so their role in Yahoo is limited to spiritual leaders. It is worth mentioning that, fortunately, Yang Zhiyuan made a very correct decision at that time, and acquired more than 40% of Alibaba’s shares from the assets of Yahoo China’s assets plus billions of dollars in cash from Sun Yat-sen, a member of Softbank Group.
Although Wall Street can control Yahoo by capital, it cannot give Yahoo a guide. The Internet industry is different from traditional industries and it is slow to develop. A professional manager can appoint an existing business. In the rapidly changing Internet industry, only the veterans who have worked hard in this industry can grasp its development context. Yahoo's managers Samuel and Dekker do not have this ability.
When a company's profits can no longer grow rapidly, Wall Street (and other capitalists) would like to change the CEO's favorite thing. From time to time, such as Icahn, an investor, jumped out of the board at any time. event. So from 2007 to 2012, six years before and after Yahoo experienced six CEOs, it is precisely because of seeing the confusion caused by Wall Street to Yahoo, I dared to boldly predict Yahoo as an independent company in this period is not long.
Then in 2012, the cutting-edge Mayer took over Yahoo. As a workaholic, Mayer set an example and brought a new atmosphere to this dead company. And Wall Street once gave her time to turn things around, but in this soulless, capital-strapped company, anyone can hardly turn around. From an investor's point of view, Yahoo's business can be realized when it can sell some money, and it is in their best interest to be blameless.
It can be said that since the first day of its birth, Yahoo has not been short of money, and today it has cash on its account, not to mention the large number of other companies that can cash out. However, many times when the money is rich, it is impossible to do anything. After all, things need people to do it.
Although history cannot be assumed, there are always people who think that if Yahoo is allowed to walk around again, will it be able to no longer miss the opportunity for the development of the Internet again and again? In fact this is very difficult. It should be said that Yahoo did not make too many mistakes on the tactical level. Many of its choices were correct at the time, although we call them mistakes today.
In the Internet 1.0 stage where everything needs to be done and everything can be done without a shortage of funds, it is obviously reasonable to choose such a strategy of enclosing, planting, and flowering everywhere, and if only focusing on Google, A technology seems to be unreasonable. Google chose to do a good job of search, except that Page and Brin were able to look at the money lighter and able to endure sex to do one thing, but objective conditions also contributed to them doing so. After Google's first official financing (A round), the Internet bubble broke up. It could no longer saturate its money. The 20 million US dollars that it is not easy to spend has been saved, so it can only do one thing.
In the era of Internet 2.0, Yahoo was the largest online media in the world at the time and had the most advertising revenue companies. If it was to make it separate and broadcast, the road to Internet 2.0 would be tantamount to a broken man's wrist. Will make this decision. In the era of mobile Internet, Yahoo CEO Meyer () wanted to lead Yahoo's transition, but Lu Qi and other engineering elites all left. It was already a clever woman who couldn't make it through. When we look back at a piece of history, we often find that if we put ourselves in the historical environment at that time, we can understand what the people at the time did seem to be making mistakes afterwards. Actually, it is completely obligatory, and we will do the same. This seems to be the inevitability of history.
Technology must always move forward. No one and no company can keep a technology forever and remain invincible. Standing in front of a wave is far more important than sticking to an existing site.
The era of Internet 1.0 represented by Yahoo! has long passed. The era of mobile Internet has also come to a head. We can't help asking what the next wave will be. We human beings are entering an era of fully connected and super smart times.
From the networking of machines and machines of the Yahoo era (Internet 1.0), to the networking of people and people today (Mobile Internet), and to the future of Internet of Things (IoT), we increasingly find that connection is more important than possession. O2O, the sharing economy we often talk about today, is based on this premise. Google and Facebook, without much content, can become the largest Internet company. Taobao does not own goods and logistics, but it can become the largest shopping mall in the world. Didi and Uber do not own a car, but it is the largest rental company in the world. Car companies, they have a common feature is the connection, including people-to-people connection, but also includes people and things, and in the future of things and things connected.
Connections generate big data, data processing requires intelligence, and this intelligence is far from the intelligence of every human being. It requires super, machine intelligence, which will be an extension of our human intelligence. In the future, our society will be a fully intelligent society. We will have unlimited opportunities and we will also meet unprecedented challenges. With regard to the many features and opportunities of the future society, we can refer to the "Smart Society."
From the rise and fall of Yahoo, we can see the development course of the ups and downs of Internet technology. We can also understand that in the information age, it is actually very difficult to pursue a long-established century-old store. What we can do is try our best to grasp every technical tide. For any company, it belongs to an era. When an era passes, its historical mission has already been completed. Therefore, its end is not a bad thing. Only in this way can we release resources to invest in more important industries. Go to.