There was a time when Yahoo refused to buy Google for $1 million

Yahoo Sold for $4.83 billion to Verizon, Sergey Brin and Larry Page approached Yahoo to sell Google for $1 million

The very Yahoo which was sold to Verizon for $4.83 billion was offered Google on the platter by its founders, Sergey Brin and Larry Page for a measly $1 million. And today while Yahoo is nowhere in the Internet landscape save its email and some other services, Google and its parent company, Alphabet are valued at nearly $500 billion.

You can call it an irony of sorts but Yahoo is responsible for its own demise. After making several attempts to reinvent itself since it lost relevance, Yahoo has finally announced that it is selling most of its core services to US telecommunications giant Verizon.

Yahoo was one of the companies that defined Internet. In fact, in some ways, Yahoo was the harbinger of the famous Dot.com era when it was valued at over $100 billion. Yahoo was the king of search and mail in 1990s but failing to adapt to the new changes contributed to its downfall.

A few insiders know that Yahoo missed several big ticket opportunities to make it to the big league. One such opportunity came to it on a platter in 1998 when Google’s Larry Page and Sergey Brin had approached Yahoo with an offer to sell their PageRank system for as little as $1 million. At that time both Page and Brin had just developed PageRank but wanted to focus on their studies at Stanford. Yahoo being dimwitted or extra smart refused their offer because it wanted to develop its own platform.

PageRank is the very same algorithm that powers Google search today. PageRank algorithm was designed by Brin and Page that ranked websites in the order they are displayed in Google search results. Brin and Page named it after Larry Page and first proposed the idea of codifying how a search engine measures the importance of websites. While PageRank helped in showing up search results of relevant third-party sites based on keywords. Yahoo did not want users to leave their platform at all. It had directories that were designed to answer questions, view email, shop and even play games on its platform – something that seemed to work well for them at that time.

Yahoo at that time had other ideas. Brin and Page’s PageRank took visitors away from the page once the results were displayed but Yahoo executives did not want users to leave their platform at all. It had directories that were designed to answer questions, view email, shop and even play games on its platform. This all in one technique worked well in 1990s but with time, Internet users demanded specialised websites for each feature and Yahoo fell to the wayside.

That is not all. In 2002, Brin and Page again approached Yahoo. This time to raise funds for Google’s expansion. Giving $3 billion to Brin and Page would have meant Yahoo getting a substantial pie of Google but Yahoo refused. Then Yahoo Chief Terry Semel refused the offer as it looked to again build its own search engine to compete with Google. Yahoo acquired search engine Inktomi and ad revenue maker Overture in its mission to build the search engine that would topple Google.

Again, Yahoo failed in execution while Brin and Page brilliantly took Google to new heights. It all started with Yahoo being valued at $100 billion its heydays and ended with it being sold for just $4.83billion to Verizon while Google is giving its stakeholder the best value for money on Nasdaq.

2 COMMENTS

    • Actually, I think, Intel did too. Apple inquired Intel to be their partner on their iPhones. But Intel declined. Look at where iPhones are now.

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