Monday, November 8, 2010

AOL and Yahoo Merger?

Last month, we spoke of the talk of merger between AOL and Yahoo. This rumor continues to have life as more is being written. Today's WSJ is examining the opportunity further. "Why get all hot over the prospect of an AOL/Yahoo merger? As The Journal notes, analysts say it could create a strong competitor in the market for online display ads -- a market that is expected to total roughly $20 billion worldwide this year, and could reach $50 billion over the next few years." With Google maintaining a healthy lead in market share, a merger may be necessary to gain some yardage in this foot race.

Is there synergy in such a merger? Will additional cost efficiencies or revenue projections improve as a result of this partnership? Frankly, I wonder if it will only show the overlap of usage and incremental market share will not be uncovered. What is missing is innovation. Partnership is needed with the right parties. Build the better mousetrap and users will move over to you. Google can be beaten.

Scripps and AT&T Agree

Having lived through the Cablevision and Fox negotiations, it is nice to see another network find quicker resolution. Fox was off the air for weeks; Scripp's channels, HGTV, Food, and others were off the air for three days. "The two sides had just begun gearing up a public relations offensive, launching informational sites like and aimed at targeting customer frustration at each other. U-verse's facebook page was flooded with comments from mostly angry fans of Scripps channels threatening to change their service if their programming was not restored." And so another deal is done but not before the customer is both brought into the fight and also inconvenienced. At the end of the day the viewer has lost time with their channels and will ultimately pay more for them. Simply put, the customers keep losing.