3 charts for you today:
This week private equity firm Apollo acquired Yahoo, and various other media assets including what is left of early internet platform AOL, for $5bn and change from Verizon.
Verizon had a master plan to take on big tech when it acquired AOL in 2015 and Yahoo in 2017, paying $4.4bn and $4.5bn for each respectively, and merging them into a brand which it called "Oath". Verizon was hoping that combining its other digital assets (which included The Huffington Post and TechCrunch) with Yahoo's large audience would help reinvigorate revenue growth at Yahoo, which had gone into reverse since 2008 (as shown in the chart above). The Yahoo acquisition also came with various other digital properties, including Tumblr — the social networking site.
It was an ambitious plan.
It didn't work.
Less than 2 years later, Verizon reported a $4.6bn write-down of its "Oath" unit, citing "competitive pressures". 8 months later social networking site Tumblr was sold for peanuts (less than a 5-bed house in San Francisco) in 2019 and HuffPost was sold to Buzzfeed last year.
Verizon is fully giving up on its plan, selling Yahoo and AOL for $5bn. For that money the buyer will get Yahoo.com, which despite its woes remains one of the most visited websites on the internet according to data from SimilarWeb.
Indeed, Yahoo.com still gets visited almost 4 billion times a month — more monthly hits than Amazon.com and a number of other internet giants.
The company buying Yahoo, which is private equity giant Apollo, is hoping to better monetize that traffic — and get whatever they can out of an internet brand that first got its start back in 1994. Not known for frivolous spending, private equity owners are unlikely to feel nostalgic sentiment about squeezing everything they can out of Yahoo and its brand.
Diamonds are forever. Perhaps one of the most famous marketing taglines of all time, first penned by Frances Gerety in 1947, has stuck in the diamond industry ever since. But, the diamond industry as we know it, may be under threat.
Opening Pandora's box
This week Pandora, which is the world's largest jewellery company, announced that from now on they would no longer offer mined diamonds — instead only sourcing diamonds that are created in a laboratory. This is a big deal for lab-grown diamonds, which only accounted for 6-7 million carats of global diamond production last year (according to a report from Bain).
The ability to create a diamond in a lab is not new. In fact, the first synthetic diamond was reportedly created in 1954 — just 7 years after Frances Gerety wrote her famous marketing slogan. So far then, the mined-diamond industry has been doing just fine, with lab-grown alternatives gaining little traction before the last decade.
However, recent advances in technology, coupled with increasingly ethically focused consumers, has meant that both the demand and supply of lab-grown diamonds has increased significantly in the last decade. Pandora's announcement this week is likely to accelerate that trend.
The diamond mining industry might need another slogan.
P.S. Decent video explanation of how lab-grown diamonds are made can be found here.
1) The future of the Bill & Melinda Gates Foundation, which contributes roughly $5bn a year to charitable causes, is more uncertain after the couple announced their divorce. They have reportedly already agreed on how to separate their fortune and have pledged to continue working on the foundation together.
2) We wrote earlier this year about the baby-bust in Europe — now the latest data confirms the same phenomenon has happened in the US. Live births in the US recorded their largest single-year drop in nearly 50 years, falling 4%.
3) Mountaineers on Mount Everest are concerned about a potential COVID outbreak after reports of 17 confirmed cases in Kathmandu from climbers who had been sent for treatment.
4) The most successful people in the world all have one thing in common - they're adaptable. If adapting to change is something you struggle with, try this free audio course from Jason Feifer.**
5) Buzzy audio start-up Clubhouse might already be losing its lustre. According to data from Sensor Tower, downloads have fallen from 9.6 million a month to just 900,000 in April.
6) The Facebook Oversight Board has upheld Donald Trump's ban on the platform, but has promised a review of the length of the suspension within 6 months.
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