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More good good let's talk about the big news in the business world and -- merger Monday right Yahoo!.
Is buying stuff I can't close -- six years old but Tumblr which is a photo blogging social site or one point one.
Billion dollars and I think the greatest part about this story -- is -- some of the -- Young social media sites on Tumblr might not ever heard of Yahoo!.
You have that's true really.
-- surprisingly enough I think that's true and I think its interest -- you made the comment about it -- one point one billion in cash I think that's.
Let's give a lot of people's attention decision released today -- -- -- Yahoo! over -- That I think that's on unknown as of yet but I would characterize it this way I mean you're talking about a company that has -- let's just say twenty million dollars in revenues -- you're talking about.
Fifty times revenue and some people -- -- what they can make a hundred million dollars in revenue OK so now we're only ten times.
Revenue you know I think that the proof is going to be in the put in in terms of their ability to actually grow.
You know the revenues of that business and even more importantly they got to grow the operating income -- -- make money at that business so.
You know I think it's going to be a really tough one to be able to.
You know generate the kind of return that's going to be required when you got that kind of an investment that's all -- is some are making money now.
You know it's unknown they are very.
They are a so they are a privately owned company so we don't know exactly but the the understanding is is that they are not.
Making money right now and we can be pretty hard for them to.
You know even if they were making money -- those revenue levels it's pretty insignificant you know.
Again in my -- a little bit of the old days that we were talking about you know almost ten years ago now with some of the dot com or were you know we -- companies not only didn't have any profits and have -- revenues and I think that's a little bit the struggle here.
-- and -- said that because this is the biggest acquisition for Yahoo! since the 1990s.
Very light in a decade I should say in about it that it's a little bit after that but it certainly the biggest under CEO of -- -- -- been that for ten months she's obviously.
Think she's made about by the way I think she's made about ten acquisitions -- -- ten months and that's clearly got a game plan for doing this so yeah.
You know probably one of the biggest benefits as they -- people like us talking about it you know I mean if you think about who was talking about Yahoo!.
You know six months ago I mean you know clearly they've got everybody's attention it's big news it's Monday morning you know all the business news is talking about Yahoo!.
You know that that alone -- gotta be worth something because it's giving more attention.
Which brings us to another potential problem.
Yahoo! is an older Internet company right 1990s.
Seems like ancient history for the young people the twenty somethings who are doing everything -- -- now.
Com and and that's what I Yahoo! is doing -- they want that younger crap.
They need to move forward they need to kind of revamp themselves a little bit the same -- that younger crowd.
Who views Yahoo! less like their grandfather's kind of contain very -- -- think that that could be a negative reports come.
You know I think it's got the potential for that I think one of things that Yahoo! has to be careful -- -- just how they go about the integration of this and I know.
-- made the comment that.
You know we're not gonna screwed up I think was it you know kind of under a quarter -- on -- but.
I think part of point is as if you're not to screw up but what are you gonna do with it and how do you.
How do you balance the need to get some value in growing that business and having some connectivity with Yahoo!.
And and being able to be something that's gonna be attractive for the Tumblr users -- the Tumblr users are.
Yahoo! has a lot of young users.
But these Tumblr has a lot more young users and they use the technology differently.
-- the Yahoo! users I think that's one of the key differences.
And and we know that this is a fickle group of folks are facing different technology that they think is better I mean there.
They're they're known to move pretty quickly yes of their way to put -- -- fickle group of yeah.
Families -- you are and and NA expert in fact here and author of of -- book -- call -- successful acquisition so what is the meaning your opinion this merger first motor company.
Well I think there's going to be a lot of from pressure for company CEOs I think they're gonna have a lot of calls from their boards of directors sent.
Hey what are we doing what's our strategy are we giving in to technology.
You know in this case the thing that we've been hearing about you know constantly is not just technology but in particular mobile technology.
And I think that's really one of the critical things -- every trying to figure out how to get in the mobile technology if you -- or see a lot of boards and news CEOs what's our strategy.
What are we gonna do.
One of the other issues that we've got going on right now there have been talking about is is we got so much excess cash.
And I know billion dollars sounds like a lot of money it is but it's only about maybe a fifth of what the arm.
That Yahoo! has on their balance -- so.
You got a lot of cash -- got a lot of movement going on the marketplace so I think you're gonna see a lot of pressure on CEOs to make acquisitions.
Hank and quickly are there any similarities you talking about mobile which makes me think of say stuff between race against Japan deal.
Yeah absolutely so FaceBook is you know and they got some of the same similarities where they want to be on mobile technology but it still trying to figure out how they immigrated.
And I don't think they've really kind of got their foot and on that yet so I'll be -- agency and how they actually get people to.
Use Tumblr to go over and use Yahoo! and the other generate revenue there.
And I think I think Yahoo!'s got some of the same kinds of challenges weapons program yes you're right they integration -- BK did a front thank you so much.
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