Thursday, May 15, 2008
The Sweet, Sweet Irony of Mark Cuban and Yahoo
Of the amazingly Internet-experience-free board that billionaire investor Carl Icahn has proposed to replace Yahoo’s current directors in this proxy fight, there is one name who does have a lot of Web-related experience, especially with regards to Yahoo (YHOO).
Specifically, in how to make bank from Yahoo’s desperation.
That would be entrepreneur and all-around bon vivant Mark Cuban (he is pictured here at our first D: All Things Digital conference in 2003), who sold Broadcast.com to Yahoo in the heady days of 1999 for $5.7 billion in Yahoo stock.
It was a huge deal at the time, with Yahoo engaged in an arms war with other Internet companies like Excite (remember them?), AOL (TWX) and others.
In an acquisitions frenzy, it grabbed Broadcast.com, which was started in 1992 as AudioNet, with Cuban and others in charge.
Broadcast.com was one of the nascent efforts to broadcast online, focusing on radio-like content on the Web, largely using sports and other live events.
It had one of those typical Web 1.0 faux-blockbuster IPOs in 1998 and then, as the stock began to decline, sold quickly to Yahoo a year later.
Right before, as it turned out, the whole bubble burst.
But Cuban and his cohorts made their scratch and were soon gone from Yahoo.
Cuban, sensing the end was nigh, also dumped his Yahoo shares before the decline. And, armed with a fortune, he began his fun foray into a range of businesses, from sports teams to movie theaters to his HDNet, a high-definition cable network.
And, of course, the private jets and entertaining courtside antics and working at the Dairy Queen!
And, also of course, most of Broadcast.com’s assets are useless to Yahoo today.
Now, Cuban is back knocking at Yahoo’s door as an invader, the only major Internet figure apparently willing to turn on the iconic Yahoo CEO and Co-Founder Jerry Yang.
Calling Benedict Arnold!
