Yahoo sold its stake in Alibaba for $7.6 billion, but will funnel most of the after-tax proceeds back to shareholders.
The search company’s after-tax take will be around $4.3 billion, $3.65 billion of which will be returned to Yahoo’s investors. However, it’s unclear whether the company will return the money in the form of buybacks or dividends. A buyback, in which Yahoo offers investors the option of selling back a portion of their shares at a premium, would boost Yahoo’s stock price.
Yahoo had previously owned a 40% stake in Alibaba, the Chinese e-commerce giant. Under the terms of the deal, Alibaba paid Yahoo about $6.3 billion in cash plus $800 million in preferred shares in the company. In addition, there was a one-time $550 million cash payment related to the two companies’ intellectual property license agreement. Yahoo bought its stake in Alibaba in 2005 for $1 billion.
Alibaba said it paid Yahoo about $6.3 billion in cash and $800 million in preferred shares in Alibaba Group. It also made a one-time cash payment of $550 million in connection with an amendment to the two companies’ intellectual property license agreement.
Though there was speculation that new CEO Marissa Mayer would use the influx of cash to buy attractive startups, it appears there will be little left for such activity.
Not content with free food, now Marissa Mayer — Yahoo’s new CEO — is giving all employees brand new smartphones.
And not just any smartphone either. According to Business Insider, Mayer is going to allow employees to choose from an iPhone 5, Galaxy S3, a few HTC devices or Nokia’s Lumia 920.
Notably absent from the list: BlackBerry. Yahoo is going to move its users off of BlackBerry devices in 22 countries and onto something more consumer friendly.
Mayer is encouraging her staff to think and act more like Yahoo’s users. In fact, that was a big part of the rationale for the new smartphone program, aptly named, “Yahoo! Smart Phones, Smart Fun.”
In a memo sent out to staff members about the new plan, it was explained that using the most popular consumer phones would allow employees to “think and work as the majority of [Yahoo’s] users do.”
Bye, Bye BlackBerry
Like lots of other large corporations, Yahoo’s previous IT policy had the majority of its 22,000 employees using BlackBerry devices. For years, BlackBerry’s biggest advantage in the enterprise was that it is easy to mass-deploy phones with certain access settings and security profiles to hundreds or thousands of users.
In spite of the growing BYOD (Bring Your Own Device) movement and the proliferation of MDM (Mobile Device Management) companies such as MobileIron that make it possible for IT teams to manage multiple mobile operating systems, some companies remain locked into the RIM ecosystem.
That can make sense if a company needs a very specific set of security requirements that only BlackBerry can meet, but it doesn’t really work for a company like Yahoo. Why? Because when it comes to consumers, BlackBerry is almost dead.
Globally, the brand has something like 80 million subscribers — but the majority are on low-cost messaging plans in the developing world and emerging markets. A recent smartphone study pegged RIM’s usage share at just 1% in the United States.
For a company like Yahoo — whose business is a purple mix of technology services, display advertising and media — it doesn’t make sense to focus on attracting BlackBerry users. Heck, it’s unlikely that Yahoo sees much of its mobile traffic coming from BlackBerry users.
If a company is going to create consumer facing products and services, it needs to be able to experience those products the same way its users do. When it comes to mobile, more often than not, that means not using a BlackBerry.
See Products and Services As Users See Them
At Google, Mayer was a well-known advocate of dogfooding — that is, using your own product for your own work. Even in her first days at Yahoo’s CEO, it was clear Mayer would carry on with that approach at her new job. With the new smartphone plan, Mayer is taking the dogfooding approach to the next level: She’s making employees not just use their own products, but use those products as a consumer would.
It’s a genius move on the part of Mayer, because not only does it raise morale (who doesn’t like to get the latest, greatest phone for free?), it helps push employees from all parts of the company — from product managers to engineers, from sales to customer support — to look at and approach Yahoo from the point of view of the average user.
That means that instead of accessing Yahoo mail from within a BlackBerry mail client configured to work with a BES email server, employees will access email from either the default mail clients on iOS, Android and Windows Phone — or from a mobile webmail interface.
It means that instead of not using Flickr mobile because there is no BlackBerry app and the mobile website stinks, Flickr team members will be forced to see how lousy the iOS and Android clients really are.
Moreover, using modern tools in the workplace might allow employees at all levels to compare how Yahoo’s various products stack up against the competition.
I look forward to watching what impact the new smartphone program will have on Yahoo’s products. Something tells me that seeing a product through the user’s eye will make it possible for team leaders to focus on crafting better experiences for those users.
What do you think of Marissa Mayer’s smartphone strategy? Is it something other corporations should consider doing? Let us know in the comments.
The tactile pleasure of worn pages between your fingers is hard to replace. But when it comes to encouraging people to embrace the written word, e-readers trump their physical counterparts.
According to the infographic below, people who own e-book devices say they read more than people who don’t, at a rate of 24 books per year to 15. Education, escape, relaxation and entertainment rank as people’s main motivations to plow through books — proving that, whether electronically or via dead tree, reading remains a popular pastime.
E-readers are also rising in popularity, signaling that it may not be impossible to imagine a world without traditional books sometime in the not-so-distant future.
Before you scoff, consider this: From December 2011 to January 2012, e-reader ownership nearly doubled, from 10 percent to 19 percent, among American adults. And that stunning surge in just one month’s time doesn’t even account for tablets or other mobile electronic devices people use to read books and longform content. Worldwide, meanwhile, e-reader sales rose by nearly 3 million between 2010 and 2011.
It’s also interesting to look at the relationship between actual e-book consumption and ownership of a device that enables users to read books electronically. According to one study, 29% of American adults own a personal e-book device, tablets included. But just 21% of adults had actually read an e-book in the past year as of February 2012.
All this information and more comes to us from the online education portal Schools.com, which surveyed a handful of sources from around the web to produce the following infographic. Check it out below, then let us know in the comments — do you think traditional books will ever die out?