Yahoo users have no need to panic

July 23, 2016

Verizon-Yahoo! merger/acquisition

For Yahoo’s stalwart users, the company’s acquisition should not usher in any dramatic changes in the near future.

Some industry analysts say people using Yahoo Mail, its search engine or its news page now may feel more secure, and that services are unlikely to disappear from lack of funding or lack of corporate interest anytime soon.

However, for a company that has become a decided B-list player after once being an Internet pioneer, changes to Yahoo may be akin to a tree falling in a forest when there’s no one there to hear it.

“In a lot of ways, the removal of Yahoo as a destination on the Internet is like removing your hand from a swimming pool — it just doesn’t really make much difference,” said Dan Olds, an analyst with The Gabriel Consulting Group. “In the short term, it’s just another day for Yahoo users… I think there will be some pruning over time, taking out some of the services that overlap, like email, for example. However, I think it will be a gentle transition for the vast majority of users.”

Shar VanBoskirk, an analyst with Forrester Research, noted that the user experience may very well improve for Yahoo users and Verizon subscribers as the two companies are integrated.

“I wouldn’t think of this as the death of Yahoo, but rather as a much-needed rebirth,” said VanBoskirk. It’s going to join “an ecosystem which can access users offline and via mobile. This extends Yahoo’s reach and allows it even richer audience profiles to target ads against. If done right, this deal gives Yahoo a platform to be the powerhouse media company that it couldn’t manage to be on its own.”

Verizon Communications is buying Yahoo’s operating business for approximately $4.8 billion, the companies announced this week.

With the acquisition Verizon will scoop up Yahoo’s 1 billion monthly active users, Internet properties and applications like search and email, along with its advertising systems.

It’s a sign pointing to the end of the road for a company that has been struggling for years to be a critical online player in a world where it was eclipsed by companies including Google, Facebook and Twitter.

Four years ago, the company hired former Google executive Marissa Mayer to take over as CEO.

Yahoo’s board had high hopes that Mayer, who was the company’s third CEO in less than a year, would come in with fresh ideas and fresh energy and reinvigorate the company.

That, though, just wasn’t to be .

Now Yahoo will be folded into Verizon.

That leaves the question as to what will become of the Yahoo properties and services that people have been using for years.

For now, Yahoo remains an independent company through the close of the deal, which is expected in the first quarter of 2017. The company is expected to continue to support, and possibly even build out, its Mail, search and Tumblr platforms.

Verizon is hinting that users may not see any dramatic changes in the short term.

“Yahoo will be operating on its own as a separate company until the transaction receives regulatory and shareholder approval, with an anticipated closing in early 2017,” Bob Varettoni, a Verizon spokesperson, said in an email to Computerworld. “Until we are able to meet with and discuss plans with Yahoo management, we are not in a position to talk about operational specifics. However, I would point out that we emphasized in our announcement yesterday how much we value all aspects of Yahoo’s core business.”

Yahoo Mail, for instance, is generally considered to be a “sticky” service, so Verizon would be unlikely to eliminate it. But it could see changes in time.

As for search, that could be a good arrow for Verizon to have in its quiver so the company may step up investment in that service. It’s unlikely that Yahoo Search could take on Google, but it should remain a player.

According to Jeff Kagan, an independent industry analyst, users have nothing to worry about, at least for a year and a half or more.

“The question is what comes next,” he said. “I would think they would keep Yahoo as is for existing users for quite a while. I also think they will be thinking about ways to improve the Yahoo experience. Yahoo users can breath a sigh of relief.”

For Rob Enderle, an analyst with the Enderle Group, the acquisition is still a sad moment in high-tech history.

“Yahoo was one of the few dot-com survivors,” he said. “Some of us will [miss it], but it is far from the power it once was. The brand still has value and the property can still be recovered under the proper leadership.”

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