After I wrote my post about Tumblr’s hidden value the other day, Ben Schenker and I got into a conversation about if Yahoo! might present an appealing takeover target, similar to Verizon’s acquisition of erstwhile internet behemoth AOL. It’s hard to imagine, but AOL also seemed equally improbable. Despite its somewhat dated brand image, it’s still an enormously popular web presence, with about 7 billion visitors per month, and ranks 4th in the US for web traffic. But, as I wrote, the market basically values Yahoo! at close to zero – or for argument’s sake, about $3-4 billion, depending how highly one values Tumblr – and the company presents a tempting acquisition target for a larger firm with cash to spare. A few reasons for the purchase might be Yahoo’s engineering talent, its intellectual property, its impressive sports portal, as well as ownership of Flickr and Tumblr.
Considering that Verizon picked up AOL, one could make the case for AT&T, but I think that Facebook or Google would present more likely candidates. They both have cash to spare, and a proclivity to vacuum up products in the social, messaging, and mapping space. I doubt that such an acquisition will happen in the near future, but if Yahoo continues to be outmaneuvered by its rivals, I think we may see a buyout at some point within the next few years. And I think Yahoo Sports would look great on an Oculus Rift.
Silicon Spatula 
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