Yahoo once considered buying Netflix — but unfortunately acquired Tumblr instead, Ex-CEO says

Coulda, woulda, shoulda?

Ten years ago, Yahoo was looking for a “transformative” acquisition, former CEO Marissa Mayer said in a recent interview with Tech Brew. Among the targets the internet company was looking at: Netflix and Hulu. Yahoo ended up buying blogging site Tumblr for $1.1 billion in 2013 — which, to put it mildly, did not pan out as expected.

“We looked at a transformative acquisition, and we bought Tumblr,” Mayer said. “At the same time, we were also considering whether it was possible to buy Hulu or, ironically, Netflix. And I think Netflix was $4 billion and Hulu was at $1.3 billion at the time. And either of those, with hindsight being 20/20, would have been a better acquisition.” (Netflix’s market capitalization in May 2013 was $12.7 billion; as of Friday, it was about $143.5 billion.)

Yahoo did launch its own streaming-video play, including picking up a new season of Dan Harmon’s “Community” after it was axed by NBC. But it failed to gain traction and by 2016, the company had shut down Yahoo Screen, the video hub that aggregated its original and syndicated programming.

Meanwhile, Yahoo had hoped Tumblr would be its anchor entrée into social media. But it struggled to monetize Tumblr’s user base and, in 2015, took a $230 million goodwill-impairment charge. Verizon ended up buying Yahoo in 2017 for $4.5 billion. In 2019, Verizon sold Tumblr to Automattic, the company that owns and operates online-publishing platform WordPress, for a reported $3 million. Yahoo is now owned by private-equity firm Apollo Global Management.

In 2013, Yahoo had been among the bidders for Hulu when Hulu’s owners at the time — Disney, Comcast and 21st Century Fox — were conducting a private auction for the site. By July of that year, the triumvirate had called off the sale after they decided to retain their ownership of Hulu.

Today Hulu is majority-owned by Disney, but the streamer’s future is in flux. Disney CEO Bob Iger has said the company is examining whether it will seek to buy out Comcast’s 33% stake in Hulu or whether it will look to sell or spin off the streamer. “We are really studying the business very, very carefully,” Iger said in March. He called Hulu “a solid platform” with strong original programming and library content but added that “the environment is very, very tricky right now and before we make any big decisions about our level of investment, our commitment to that business, we want to understand where it could go.” Variety