Ten Worst Internet Acquisitions Ever

So what makes for a really bad Internet acquisition? First, it has to be expensive. No one’s going to rake a company over the coals over a few blown $50 million acquisitions. That might sound like a lot of money to you and me, but that’s a rounding error to Google.

Second, for an acquisition to be lousy it has to contribute little or no long term growth to the acquiring company. An acquisition that doesn’t fit with a company’s long term strategy and that is quickly forgotten – that’s a bad buy.

So, here is my highly subjective list of the 10 worst Internet acquisitions of all time:

10. Hotmail – acquired by Microsoft (MSFT) in 1998 for about $400 million. Hotmail was a second-tier free email service when Microsoft bought it and the acquisition did little to improve Microsoft’s internet portal ambitions.

9. Skype – acquired by eBay (EBAY) in September 2005 for $2.6 billion. While it’s early to call this one an absolute dud, eBay does not seem to have a plan – or at least a plan that would justify the acquisition price – for how to integrate Skype’s calling service with the core auction business.

my simon8. MySimon – acquired by CNET (CNET) in 1999 for $700 million. The price comparison site mySimon was supposed to launch CNET into lots of non-tech verticals – not a bad idea at the time. Unfortunately CNET had no idea how to effectively integrate mySimon and it’s now withering away, surpassed by newer, shinier price comparison engines.

7. BlueMountain.com – acquired by Excite@Home in 1999. $780 million for an online greeting card site. ‘Nuff said.

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