Last modified: December 8th, 2022 at 12:37 pm
Hard as it is to believe, there was a time when Yahoo nearly saved the world. Not with useful search results, you understand, but by purchasing – and presumably ruining – Facebook before it became the unstoppable fake news spewing, data leaking echo chamber we all know
and love today.
I was reminded of that this week, because it came up in a new book published this week: An Ugly Truth: Inside Facebook’s Battle for Domination, by New York Times journalists Sheera Frenkel and Cecilia Kang.
Business Insider outlines the key section. In 2006, Yahoo, keen to keep up with Google which had just purchased YouTube, made an offer of $1 billion to buy Facebook. Zuckerberg, according to the book, was unsure of what he’d do with the $500 million he’d pocket as a result, musing that he’d probably just build another Facebook.
So the offer was turned down and his entire management team reportedly left in protest. “The part that was painful wasn’t turning down the offer,” Zuckerberg is quoted as saying in the book. “It was the fact that after that, huge amounts of the company quit because they didn’t believe in what we were doing.”
Facebook would bat away interest from a veritable who’s who of companies between 2004 and 2007, and to put it diplomatically, not all of them are thriving in 2021. Google and Newscorp are still very much alive and kicking, but MySpace and Friendster… less so.
But imagine if you were given a time machine today, and instead of taking the ever-popular Hitler killing mission, you set the dial to 2006. You either persuade Zuckerberg to accept the Yahoo offer, or kidnap him and do a good enough impression to get the deal over the line (it’s probably worth copying Jesse Eisenberg’s impression from The Social Network should it come to this). Congratulations: you’ve saved the world from Facebook’s worst excesses.
Not because Yahoo would be a more ethical custodian of social networking, you understand, but because if there’s one thing Yahoo is good at (and, actually, there may only be one thing it’s good at) it’s taking promising websites and running them into the ground.
Just ask Delicious, the site that came up with tagging. Purchased for somewhere between $15- and $30 million in 2005, by 2010 it was up for sale again, and its had no fewer than five different owners trying to fix the damage in the decade that followed.
You couldn’t ask Geocities, because it doesn’t exist anymore. But all you really need to know is that when Yahoo bought it in 1999 for $3.56 billion in stock, it was the third biggest site on the internet. When it closed a decade later, it was not.
Tumblr might also have something to say. By the time Yahoo went to buy it in 2013 for $1.1 billion, the company’s reputation was such that a petition against the acquisition attracted over 170,000 signatures. Nonetheless, it wasn’t enough to stop the deal; Tumblr duly lost over 30% of its traffic when a porn ban came into place, and the site was sold to the makers of WordPress for under $3 million.
I could also include Flickr in that list, but others have captured the bad times in far more detail than I could here. All you really need to know is that it was bought by Yahoo for $25 million in 2005, and sold in 2017 for an undisclosed sum.
There’s no social network in this mix, so if you were feeling generous you could say that Facebook would have been the exception to the rule. Well, maybe, but it’s doubtful that things would have ended any more happily than when AOL bought Bebo for $850 million in 2008. It was sold to Criterion Capital two years later for about $10 million.
So I think it’s probably safe to assume that a Yahoo-owned Facebook would follow a similar trajectory, especially as the company didn’t actually turn a profit until 2009.
Just imagine the heartache we’d have been saved from! No targeting advertising nightmare! WhatsApp and Instagram would still be owned by companies that believe in privacy! No moderators subjected to the world’s worst content! No livestreamed suicides! No Cambridge Analytica and, without other algorithmic promotion, maybe a defeat for Donald Trump in 2016 or earlier!
That is, of course, assuming that Zuckerberg didn’t take the $500 million from the sale and make something even more damaging. There’s always a worse timeline out there, so maybe don’t go messing with time machines after all.