Barry Diller Says Facebook IPO Was Not A Failure, Calls Yahoo A 'Good Nightmare'

Entertainment mogul and billionaire Barry Diller scoffed at those who describe Facebook’s initial public offering as a “failure IPO.”

and said that while he looked at buying Yahoo, he wasn’t interested in the turnaround challenge but believes it’s a “good nightmare” for whoever is willing to take it on.

Speaking in an hour-long conversation with venture capitalist Marc Andreessen at an invitation-only event in Silicon Valley yesterday, Diller said he was optimistic about Facebook’s long-term prospects when asked if he was “long” or “short” on the social network. The reason: it’s enormous user base, Diller, chairman of IAC/InterActiveCorp, told the gathering of mostly young, startup entrepreneurs at Andreessen Horowitz’s offices in Palo Alto, California.

“One billion people. Why do you need to know anything else,” Diller said after noting he was “for sure long” on Facebook. As for the company’s IPO, which has been deemed a failure by analysts and the media because of the drop in its share price since its May $38 debut, Diller dismissed that characterization. “A failure to who? They sold stock at a very high level because there was demand for it…They raised a ton of cash.”

The fact that speculators bought Facebook’s shares at a high level because it was “inflated and found there was no demand behind the demand” doesn’t mean the IPO should be deemed a failure, he said.

As for the mobile challenges facing the Facebook CEO Mark Zuckerberg, Diller said he’s confident they will be figured out. “The shift to mobile is everybody’s issue. There’s nobody who’s not going through this.”

Diller, 70, spent most of the time talking about his Internet career, which he came after he launched the Fox Network in 1986. In the early 1990s, Diller said he went on an intellectual roadtrip. “I didn’t’ want to have an idea of what I wanted to do. I certainly didn’t want to repeat myself,” Diller said. Instead, he thought “I’ll create a big vacuum and I’ll see what fills it.”

What filled it was QVC, TicketMaster, Expedia and other online properties. His current focus is on Aero, a streaming service for broadcast television that is facing legal challenges by a bevy of broadcasters. Diller says he’s counting on Aero to cause “wonderful creative destruction” in the broadcast world by giving users the ability to have an a la carte system to complete against the closed satellite and cable systems. “Everyone has sued us,” Diller joked. “We won the first round. They tried to get an injunction but they’re not going to get it.”

As for his “long” and “short” stance on other companies, Diller said he was long on NetFlix and wildly long” on Google, which he says has “the most efficient ad network ever created…I do not see that diminishing” even as it tackles the mobile market.

He  wasn’t as sure about Twitter. “It’s a great service for dissemenation of little short opinions and news,” he said. “But is it going to be a big business? I’m not sure.”

As for Yahoo, he’s also uncertain about it’s future. Diller said he looked at buying it in 2001, just as Terry Semel took on the CEO job, and then again in recent years but decided that turning the business around was “too big a task.”

“It’s so damaged It’s been uncool…for 7 or 8 years at least It’s very hard to rescue that.”

But he said it’s not impossible and that Yahoo still retains a huge audience. “It’s a good nightmare,” Diller said.

source; forbes.com

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