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Lycos Sold To South Korean Company

Posted by timothy on from the profit-and-loss dept.

maggeth writes "Terra Networks has finally decided to dump its struggling web portal, Lycos, to the South Korean-based Daum Communications Corp. Terra bought Lycos for $12.5 billion and they managed to sell if for $105 million. More details at the story on eWeek."

31 of 212 comments (clear)

  1. Now you know why the bubble burst by bigberk · · Score: 5, Insightful

    If someone actually thought that Lycos was worth $12.5 billion, you have a pretty good idea how messed up people were in the 90s, and why the bubble burst. A bunch of 'companies' creating no products, acting as nothing more than advertising and marketing information hubs, fooled millions of investors. Bravo, you sirs were truly kings.

    1. Re:Now you know why the bubble burst by weiyuent · · Score: 4, Insightful

      If someone actually thought that Lycos was worth $12.5 billion, you have a pretty good idea how messed up people were in the 90s, and why the bubble burst.

      Thing is though, everything else was massively inflated too. Terra Networks bought Lycos in 2000, in an all stock deal. So really, the $12.5 billion is just paper value. Who knows how much hard cash was actually burned -- not insubstantial but certainly much less than $12 billion.

    2. Re:Now you know why the bubble burst by saden1 · · Score: 3, Insightful

      What is Google really worth? And will it be worth what it is worth today 5 years from now. Wall Street should be called Speculation Street. You win some, you lose some. Google is flying high now but no one can guarantee it will continue to.

      --

      -----
      One is born into aristocracy, but mediocrity can only be achieved through hard work.
    3. Re:Now you know why the bubble burst by Anonymous Coward · · Score: 5, Insightful
      The article doesn't go into details, but I highly doubt that $12.5B of real money was involved. I would imagine that the deal was done with the dot.com version of Monopoly(tm) money, swapping inflated stock. The stock transferred by the companies might have had an astronomical "market value", but if they had actually tried to sell the stock on the open market to convert it to cash, the value would have nosedived. All of this "market value" would have been generated by a handful of fools buying a tiny fraction of the total stock at outrageous prices; the $billions may never have existed in any real form.

      Thus, the main value of such stock is to trade for other equally inflated stock, just like the main value of a $500 Monopoly bill is for buying little fake plastic hotels.

    4. Re:Now you know why the bubble burst by timeOday · · Score: 3, Insightful
      Wall Street should be called Speculation Street. You win some, you lose some.
      So what's the take home lesson here? Don't buy stock that will go down? Why didn't I think of that.

      It's easy to say "don't take a risk, just keep slaving away in your cube for that guaranteed $55K/year," especially after a company crashes and burns. But to escape the treadmill you must place your bets at some point. So how do you do that shrewdly? If you wait until it's a "sure thing," it's surely too late.

    5. Re:Now you know why the bubble burst by Technician · · Score: 3, Interesting

      Some investors were thinking Lyco was the beginning of Google as a portal. Unfortunately for Lycos, they aimed for advertisers dollars instead of providing consumer satisafaction. They lost the consumers as Google showed them how it's done. Even while Google was growing and passing Yahoo and AOL, Lycos didn't get a clue and thought more and bigger ads = more revenue. They missed the important step of obtaining market share. Oops!

      On another note, I wonder if MS is going to be too overloaded and advertisement heavy in their new search engine. Are they going to take a page from Google? Are they going to try to embrace and extend IE to lock in users to the MS search? Will such a miss-step drive more users to vendor agnostic browsers other than IE?

      It'll be fun to watch the MS attempt. Somehow I see it being driven by the same playbook as the X-box. A big money sink the first few years to get it linked into everything and then the advertising and paid content kicks in (tied to MS version of i-Tunes for example).

      I see the web being diveded into the MS stuff and the rest of the WWW much like AOL and the Internet. MS will index partners and Google will index the rest of the web including all the good indie, OSS, and counter-culture stuff.

      Win 98 lite will probably not show up in a MS search for windows speed enhancements.

      --
      The truth shall set you free!
    6. Re:Now you know why the bubble burst by metalhed77 · · Score: 3, Informative

      IIRC Terra also paid 60 million for the now extremely defunct sonique media player. Yes, 60 million for a skinnable MP3 player.

      --
      Photos.
  2. What a Bargain by wayward · · Score: 4, Funny

    I just took a look at the Lycos website. Loud ads AND search functionality for a mere $105 million? What a steal!

  3. So... by lingqi · · Score: 4, Informative

    Lycos owns Wired and Webmonkey and a slew of other actually really cool stuff right...
    I even vaguely remember monster.com being part of their network.

    Lycos portal I don't care, what happens to these?

    --

    My life in the land of the rising sun.

    1. Re:So... by jasonla · · Score: 3, Informative

      I have received two replies from Wired News staffers, regarding my email. They confirm that Wired News, as part of Lycos, was sold to Daum.

      No one, including the staff, knows what will happen to Wired News as it is too early to tell, both staffers said. One staffer said there had been talks of splitting Lycos's various entities and selling them individually, but the idea was dropped.

      The staffer also pointed out an interesting difference between the Wired News website and Wired printed magazine. The magazine is owned by Conde Nast and is not part of Wired News. Lycos owns the website and publishes articles from the magazine through a deal the two forged a few years ago.

  4. Nothing by Anonymous Coward · · Score: 4, Informative

    They weren't sold

  5. It's okay by Anonymous Coward · · Score: 5, Funny

    The Slashdot 503's will probably be fixed someday, and then you'll feel better.

  6. New variant of an old joke. by Anonymous Coward · · Score: 5, Funny
    How do you make a small fortune out of the dot com boom?

    Start with a large one.

  7. Terra is that strong? by usefool · · Score: 3, Insightful

    I must say if a company can lose more than $10 billion and still alive and kicking, it's actually not doing too badly.

    --
    Uselessful technology (Air-Charged
    1. Re:Terra is that strong? by lothar97 · · Score: 4, Informative

      I imagine most of the "loss" was in intangible assets, such as brandnames, goodwill, etc. To buy Lycos, Inc., Terra just printed $12.5 billion in stock certificates (see this article), which made the then stockholders of Lycos (valued in 2000 at $70ish per share) significantly happy. Terra is owned by Telifonica, which is the national phone company of Spain.

      --

  8. Re:Worth it? by TeraCo · · Score: 4, Funny

    Well.. my guess is 11.895 billion.

    --
    Not Meta-modding due to apathy.
  9. I should have been a stock broker... by isd_glory · · Score: 5, Funny

    Hm... $12.5 billion can buy about 925 million 12-packs of bottled Guinness Draught. At the 5 cent per bottle recycling rate in NY state, that would net about $555 million.

    The moral of the story: beer is always a safer investment than struggling dotcoms.

    1. Re:I should have been a stock broker... by syousef · · Score: 3, Funny

      Hm... $12.5 billion can buy about 925 million 12-packs of bottled Guinness Draught. At the 5 cent per bottle recycling rate in NY state, that would net about $555 million.

      Free as in beer? *smirk* I like that thinking. Can we submit this as proof that you can make money out of a free as in beer software business?

      And of course the only problem is disposing of the beer....buddy, friend, pal.

      --
      These posts express my own personal views, not those of my employer
  10. Not too bad a deal by r_j_prahad · · Score: 4, Funny

    Terra bought Lycos for $12.5 billion and they managed to sell if for $105 million.

    Not so bad a deal that they can't make up for it in volume....

  11. I remember... by Cyno01 · · Score: 4, Funny

    Back in middle school, using lycos picture search for porn. Bout the only thing its ever been good for...

    --
    "Sic Semper Tyrannosaurus Rex."
  12. This is proof of Wall Street's 'casino mentality' by iamcf13 · · Score: 3, Insightful

    How much is a company really worth when all the BS is stripped away?...

  13. The Investors Creed by Velcroman98 · · Score: 4, Funny

    It's supposed to be buy low sell high, did they forget?

    --
    Kevin
    Irrational Diversions
  14. My how times change by jlink7 · · Score: 3, Interesting

    When I was in High School (umm, awhile ago), Lycos was my favorite search engine, even over Yahoo!. I can't begin to imagine the management mishaps that had to have happened in order to drive that cart into the ground.

    I also thought that they had plenty of interesting features, they really just failed to innovate in order to compete against the Yahoo!'s, Googles, and MSNs of today.

    1. Re:My how times change by waimate · · Score: 3, Informative

      Take heart:- if, when you were in high school, you had a favorite search engine, then it is not too much of a while ago ;)

  15. nope - this is a different CEO by muyuubyou · · Score: 4, Interesting

    Terra belongs to Telefónica (biggest telecom in Spain, coming from a national monopoly). In year 2000 the CEO was Villalonga (close friends with ex-PM Aznar) whose strategy was expanding through the Americas, thus buying Lycos made sense. Villalonga was expelled by political pressure, since in Spain, american practices like stock options are considered bribery and corruption.

    The new CEO (who has devalued the company substantially) had a completely different approach and Lycos no longer makes sense in the company.

  16. Re:I sure hope they bought this domain too. by Achoi77 · · Score: 4, Informative

    I know it's meant to be a joke, but Koreans can pronounce their L's fine. Actually, they can have more trouble pronouncing R's. Which means that Lycos would be preferred over Rycos. Don't confuse Japanese with Korean.

  17. but Lycos is the best place in the Internet by rggoldie · · Score: 3, Funny
    It's hard to believe Lycos could fall so far when their "high octane site yields access to literally everything that makes the information age great." Lycos Culture
    Our Culture - What Do We Do? Lycos is the most exciting online service in existence. Combining elements of navigation, community and commerce, we forge speedily ahead in our goal to become the most visited online destination in the world. Lycos gains our followers the old fashioned way...we earn them. Our interactive products and an unmatched customer focus guarantee us a spot at the zenith of the World Wide Web. One quick browse through our high octane site yields access to literally everything that makes the information age great. Join Lycos and secure yourself a place in the future of the Internet.
  18. Evidently... by Chordonblue · · Score: 3, Interesting

    They must know something we don't. I can tell you that every single Korean girl in our school has a Daum account - as amazing as that seems.

    Daum is also consistantly the most visited portal in S. Korea. They are now what Yahoo was 3 years ago. Hell, they even LOOK like Yahoo!

    So why would a top Korean site purchase Lycos? For SmartSearch perhaps? Dunno!

    --
    "...Well, there's egg and bacon; egg sausage and bacon; egg and spam; egg bacon and spam; egg bacon sausage and spam..."
  19. Ummmmm, 2%? by tehdaemon · · Score: 3, Informative
    At that price, you would earn about 2%/year on your money. Not all that hot. The only way that this makes sense is if you think that Google will a) double (or better) its profits by cost cutting etc., or b) double (or better) it's revenue with the same profit margins, and you think that Google's market value will not fall. Or you think you can sell it back soon to an even bigger sucker than yourself before reality sets in.

    If not, well, 10 year Treasuries are yealding 4.5%, and you will get your money back. Given the risk factors, $5 billion sounds a little high to me. It almost looks to me like the bubble lost some air, but did not pop.

    --
    Laws are horrible moral guides, moral guides make even worse laws.
  20. Re:Gone downhill by Graelin · · Score: 3, Funny

    What a world we live in. What happened to the nice Lycos dog?

    Well, I don't have this first hand but they say he had a nasty run in with drugs... PHP maybe... He was known to burn his Lycos shares just to try the new designer drugs.. then came the booze... and the hookers.. One day, the cops found him face down in his own vomit on the sidewalk all coked up. They put him in the slammer for 20 to life where is is now known as Spot the Bead Freak. (Don't ask...)

    What a world indeed.

  21. Re:So is this method not working? by nomadic · · Score: 4, Insightful

    Considering someone sold it for 12 billion, I can assure you that somewhere a very nice profit was made.