Yahoo! Inc. (NASDAQ:YHOO) has been building a recent list of acquisitions, and it was announced Monday that it has added another feather to the cap with the purchase of an app that is built for the iOS operating system by Apple Inc. (NASDAQ:AAPL). What might this mean for Yahoo! in the long run? It might mean that Yahoo! News could become more prominent on Apple devices.
Reports are out that Yahoo! Inc. (NASDAQ:YHOO) bought the iOS news summary app Summly for an undisclosed among, though one website is reporting that the amount was about $30 million, give or take, which is cash and about 10 percent in stock. The tiny news reader app, which reportedly has fewer than 1 million downloads and zero revenue to its name, was designed by a Londoner and it sort of combines standard RSS feeds and the Twitter microblogging concept by using a natural-language algorithm to summarize news stories on the Web in 400 characters or less. This is designed to allow users to scan articles quickly and they can tap on the article s they’re interested into read more.
This is being characterized as an “acqhire,” meaning that Yahoo! Inc (NASDAQ:YHOO) has bought the application and business model and is apparently turning the Summly staff of five into new Yahoo! employees where they will shut down the app and work to integrate it into various Yahoo! mobile offerings. There is no word as to whether Summly will restart as an Apple Inc. (NASDAQ:AAPL) iOS app once the integration takes place. However, the departure is being described as a “power nap.” The app was founded by Nick D’Aloisio and received some early seed money from Li Ka-shing, a Hong Kong billionaire, among others.
What do you think about this acquisition? How do you think this app and its technology will fit into the Yahoo! Inc. (NASDAQ:YHOO) business model? Do you subscribe to these news feed-type apps? What has been your experience? Give us your thoughts in the comments section below.
DISCLOSURE: I own no positions in any stock mentioned.
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