Many people may be astonished when they hear about a startup being acquired for billions of dollars, pointing to a “tech bubble” and questioning the value of these companies. But a couple millions pales in comparison to these massive tech acquisitions.
Granted the acquired companies tend to be a little bigger than the average startup, but these guys sure got a lot of money.
We’ve rounded up some of the most expensive tech acquisitions of all time to give a glimpse into the massive amount of money being thrown around in the tech industry.
Facebook bought Instagram for a mere $US1 billion to amp up its photo-sharing capabilities. The app has only grown in popularity in the past two years, with users posting everything from their gourmet home-cooked meals to celebrity selfies.
Accounting for inflation, the deal was worth $1.04 billion.
Yahoo bought Tumblr for $US1.1 billion, leaving David Karp as CEO, and bringing a big, young audience over to Yahoo along with Tumblr's expertise in mobile. This was Marissa Mayer's first big acquisition since becoming CEO.
Accounting for inflation, the deal was worth $1.12 billion.
Facebook bought Oculus for $US2 billion to develop a platform that goes beyond gaming into other virtual reality experiences. In a conference call following the announcement, Mark Zuckerberg said that he believes virtual reality will be the next big computing platform after smartphones and tablets.
Dell bought Quest for $US2.4 billion to help transform itself from a PC company to an enterprise company worthy of competing with HP and IBM. This was Dell's second-largest acquisition.
Accounting for inflation, the deal was worth $US2.49 billion.
Apple bought Beats for $US3 billion earlier this year, bringing along its executives Dr. Dre and Jony Iovine to tap into their talent and potential. This could possibly help out iTunes as it competes against streaming services like Pandora and Spotify. This was Apple's largest acquisition ever.
Google bought Nest for $US3.2 billion earlier this year, probably to give it the upper hand when it comes to home automation and the Internet of Things. Nest's founders Tony Fadell and Matt Rogers stayed on board and continue to deliver smart device technology under the umbrella of Google.
Dell bought Perot Systems for $US3.9 billion to improve its IT solutions and gain access to more customers. This was Dell's largest acquisition of all time.
Accounting for inflation, the deal was worth $4.33 billion.
Microsoft bought Nokia for $US7.2 billion, taking over their phone and tablet business under a division called Devices Group. Known as the biggest seller of Windows Phones, Nokia could help Microsoft as it tries to improve its market share by making it easier for manufacturers to make Windows phones.
Intel bought McAfee for $US7.68 billion to help it expand its business beyond just computers. The idea was to make all of its hardware more secure from the get go, without having to install any software. This was Intel's largest acquisition.
Accounting for inflation, the deal was worth $US8.3 billion.
Oracle bought Sun Microsystems for $US7.4 billion to help it become a one-stop technology shop for its customers. It would allow Oracle to sell simpler computing solutions at lower prices, using Sun's technology.
Accounting for inflation, the deal was worth $US8.22 billion.
Microsoft bought Skype for $US8.5 billion, mainly to improve its corporate messaging and voice-over-IP product, Lync, in both a consumer and enterprise move. It also came in handy in terms of competing with Apple's FaceTime. The company kept Skype as its own division.
Accounting for inflation, the deal was worth $US9 billion.
HP bought Autonomy for $US10.3 billion to shift their focus more from hardware to software. Autonomy provided them with a large amount of data taken from emails, music, video, and posts on social networks.
Accounting for inflation, the deal was worth $US10.91 billion.
Oracle bought its rival PeopleSoft for $US10.3 billion to maintain its primary position in the software industry. Oracle spent 18 months putting this deal together.
Accounting for inflation, the deal was worth $US12.99 billion.
Google bought Motorola Mobility for $US12.5 billion to build up their mobile offerings. Motorola made an early bet on Android and as such was always a good partner for Google. Motorola Mobility's CEO Sanjay Jha stepped down and was replaced by Google's Dennis Woodside.
Accounting for inflation, the deal was worth $13.24 billion.
Facebook bought WhatsApp for $US19 billion earlier this year to better help people stay connected. WhatsApp's cofounder Jan Koum stayed along for the move to join Facebook as an executive. Koum famously promised his users that nothing would change post-acquisition and that the app would remain ad-free.
HP bought Compaq for $US25 billion to better compete with IBM and Sun Microsystems as computer sales slowed. After months of negotiations, the two companies agreed that the merger would better position them in the industry.
Accounting for inflation, the deal was worth $33.65 billion.
AT&T bought BellSouth for $US67 billion to help it better dominate telecommunications and scale to more consumers. While the deal required AT&T to assume $US22 billion in debt, it also allowed them a market capitalisation of as much as $US170 billion.
Accounting for inflation, the deal was worth $79.18 billion.
Vodafone Group bought Airtouch Communications for $US57.4 billion, beating out Bell Atlantic in a bidding war. At the time, Airtouch was America's biggest independent wireless company. The deal created an international cellular giant.
Accounting for inflation, the deal was worth $82.09 billion.
SBC Communications bought Ameritech for $US68.2 billion to help it springboard into the local phone business of 30 U.S. markets, including New York, Denver, Phoenix, and Atlanta. At the time this was the second-largest merger in U.S. history.
Accounting for inflation, the deal was worth $99.68 billion.
Comcast bought AT&T Broadband for $US76.1 billion to improve its broadband services. The merger resulted in a total of 22 million subscribers and a major presence in 17 of the United States' 20 largest metropolitan areas.
Accounting for inflation, the deal was worth $102.43 billion.
Bell Atlantic bought GTE for $US71.1 billion to create the nation's largest telephone company, called Verizon. The deal meant that Verizon would control a third of the U.S. local telephone market, 63 million local lines and 25 million cell phone customers, in 40 states.
Accounting for inflation, the deal was worth $103.92 billion.
AOL bought Time Warner for $US186.2 billion to establish itself as a digital media powerhouse. It gave AOL access to Time Warner's more than 13 million cable subscribers, immediately boasting a market capitalisation of $US350 billion and an annual revenue stream topping $US30 billion.
Accounting for inflation, the deal was worth $257.62 billion.
Vodafone Airtouch bought Mannesmann for $US185.1 billion to help forward itself in the mobile industry. The new company found itself with 42 million customers and a value of $US365 billion.
Accounting for inflation, the deal was worth $264.71 billion.
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