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PC Upgrades on Byte-Size Budgets -- Savings ExperimentIn the war for search supremacy, the past often comes back to haunt you. For the progenitor of search and long-time incumbent, Yahoo!, this holds true more often than not.
For Terry Semel, as CEO of Yahoo!, making tough decisions is part of the job. When those decisions are cause for fanfare, then rejoicing in the limelight is a welcome perk, but when those decisions in hindsight are more than lamentable but shy of egregious, then he will certainly have to suffer some fierce criticism.
Today's New York Post: Online Edition is running a great story by Janet Whitman, covering quite the story by Terry Semel himself which he recounted at a May 11th Newhouse School-sponsored breakfast event.
The story goes that Semel met Larry Page and Sergei Brin for dinner in 2001, and though Google wasn't on the table, Larry and Sergei valued the business at $1 billion.
Semel's reply was to quip that what changed in a week, to make the company now triple in value?
Of course, his line of reasoning is a fair fundamental take on the business and supports his choice to not deal.
But I pose the question, what has changed in the past 5 years to make Google worth $110+ billion?
The business of the internet/media/search is one that is so dynamic and at the forefront of change, that fundamental valuations not capturing growth using some form of accelerated function akin to Moore's Law are simply not sufficient.
Well that's not something Yahoo! has to worry about, since Yahoo! is coming in at $43+ billion and would find the tables turned in an acquisition scenario; needing to come up with the reason that it's worth what it is.
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