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In this article, we’ll delve into former Yahoo CEO Marissa Mayer’s recent reflections on her time at the company and her regrets about acquiring Tumblr instead of Netflix or Hulu.
Key Takeaways:
- Marissa Mayer believes acquiring Netflix or Hulu would have been a better decision than buying Tumblr
- Yahoo’s attempt at streaming with Yahoo Screen didn’t achieve much success
- Mayer has other regrets, such as not hiring Lisa Utzschneider and not making a tax-free Alibaba spinoff
Mayer’s Regret Over Tumblr Acquisition
In a recent interview with Tech Brew, Marissa Mayer, former CEO of Yahoo, expressed her remorse over the company’s decision to acquire Tumblr for $1.1 billion in 2013.
Looking back on her tenure, Mayer admitted that in hindsight, Yahoo would have been better off buying streaming services Netflix or Hulu.
At the time, Netflix was valued at $4 billion, while Hulu was worth $1.3 billion.
Mayer’s realization comes after Yahoo’s underwhelming experience with Tumblr, which saw a significant write-down of its value by $230 million in 2016.
By 2019, following Verizon’s acquisition of Yahoo, the company sold Tumblr at a massive loss.
Missed Opportunities: Hulu and Netflix
During Mayer’s time at Yahoo, the company aimed for a transformative acquisition to boost its market position.
While they ultimately chose Tumblr, Mayer now acknowledges that Hulu and Netflix could have been better options.
Both streaming services have since experienced massive growth, with Netflix currently boasting over 200 million subscribers and Hulu enjoying significant success as a joint venture between The Walt Disney Company and Comcast.
If Yahoo had pursued either Netflix or Hulu, it could have potentially positioned itself as a formidable player in the streaming industry.
The Struggle of Yahoo Screen
Despite not acquiring Netflix or Hulu, Yahoo still attempted to break into the streaming market with Yahoo Screen, a service that offered original content such as Sin City Saints, Other Space, and even picked up a sixth season of the NBC-canceled sitcom Community.
However, Yahoo Screen faced an uphill battle from the start, struggling to gain traction against established competitors like Netflix and Hulu.
Yahoo’s lack of experience in producing original content and managing a streaming platform ultimately led to the demise of Yahoo Screen in 2016, just three years after its launch.
Other Regrets from Mayer’s Tenure
Apart from the Tumblr acquisition and the missed opportunities with Hulu and Netflix, Marissa Mayer has also expressed regret over other decisions made during her time as CEO.
One of those regrets was hiring Henrique de Castro as the chief operating officer, a decision she now believes was a mistake.
Instead, she says that Lisa Utzschneider, who later became Yahoo’s chief revenue officer, would have been a better fit for the role.
Another major regret Mayer shared was the failure to execute a tax-free Alibaba spinoff, which would have separated the company’s assets.
This move could have potentially saved $10 billion in taxes for Yahoo shareholders or generated the same amount in profits.
Additionally, Mayer believes that this decision might have allowed Yahoo to continue operating as an independent company and potentially achieve greater success.
Conclusion
Marissa Mayer’s candid reflection on her tenure as Yahoo’s CEO sheds light on the importance of strategic decision-making in the fast-paced and ever-evolving tech industry.
Her regrets over acquiring Tumblr instead of streaming giants like Netflix or Hulu, the struggles faced by Yahoo Screen, and other decisions that could have altered the company’s trajectory all serve as crucial lessons for current and future industry leaders.
As the tech landscape continues to change, it’s essential for companies and their leaders to make well-informed decisions that can propel them towards success while avoiding costly missteps.
Marissa Mayer’s experience at Yahoo is a testament to this and serves as a reminder that hindsight is always 20/20.
