) recently announced that it had acquired a video chat startup
company, OnTheAir, to boost its mobile offerings. The terms of
the deal were not disclosed.
San Francisco-based OnTheAir sells an application, which
allows users to host online talk shows. What sets the application
apart is the fact that the participating audience is featured
through split-screen chats for everyone to see.
Following the acquisition, OnTheAir's five-member team will
work with Yahoo's mobile division. Though Yahoo has not specified
whether it would discontinue the chat service, we believe this
acquisition appears to be geared more toward acquiring the
engineering talent than technology.
Since Marissa Mayer's appointment as Yahoo's new CEO earlier
this year, she has sought to expand the company's mobile
offerings since the space is integral to Yahoo's future growth.
As a part of its mobile strategy, the company is eyeing smaller
companies with engineering talent and mobile computing
specialists. On similar lines, Yahoo acquired a mobile startup
Stamped in October. Its application enables consumers to share
information about their favorite restaurants and music on their
According to recent data from IDC, the worldwide mobile phone
market will grow 1.4% in 2012. The research firm expects vendors
to ship more than 1.7 billion phones this year, increasing to 2.2
billion phones by 2016. Though the growth in the overall market
has slowed down, the shift towards smart devices continues.
Yahoo! Inc. has come out with better-than-expected third
quarter results with non-GAAP earnings up sequentially as well as
year over year and exceeding the consensus estimate by 11 cents.
However, a turnaround in the company's business still remains a
big task for the new CEO, given Yahoo's declining position in
display and search and the monetization issues related to
Microsoft's search platform. Yahoo also lags in several emerging
segments, such as mobile, social and the cloud.
Currently, Yahoo has a Zacks Rank #3 (Hold). We note that its
) also carry a Zacks Rank #3 (Hold) while
) carries a Zacks Rank #2 (Buy).
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