What’s that old saying about history repeating itself — the first time as tragedy, the second time as farce? (I think it was Karl Marx). I couldn’t help thinking of that when I saw the news (via Twitter, of course, my current news delivery mechanism of choice) that Yahoo and AOL are supposedly in talks on a combination that would foil Microbeast’s takeover ambitions. AOL and Time Warner was the tragedy (about $100-billion worth) and this current plan is most certainly the farce.
My friend Paul Kedrosky said that it was like tying two rocks together to see if they could fly better than one, to which I responded that to compare AOL with a rock was unfair to rocks. But another friend — Stuart MacDonald of Tripharbor.com — probably said it most succinctly: Yahoo + AOL = FAIL. I realize that Jerry Yang and the board of directors have to “pursue all available alternatives,” or whatever it says in the fiduciary duty documents, but this is ridiculous. The next thing we’ll hear is that Yahoo is talking with my Aunt Edna’s bridge club about a counter-offer.
Does Time Warner want to somehow get rid of AOL, preferably without losing an even bigger pantload of money than it has already flushed away? Sure it does. And on the surface, merging with Yahoo probably seems like a super idea for TW. But what exactly does it buy Yahoo? Some cash to do a share buyback, apparently, according to the Wall Street Journal. Whoop-de-doo. If shareholders of Yahoo vote for a shotgun marriage like that, they deserve whatever they get.