Yahoo! rumored to buy Groupon

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Lots of rumors flying around about Yahoo! buying Groupon for what seems to be a paltry sum given Groupon’s recent success. TechCrunch article here. Not quite sure I understand how this rumor got started or why it got started. The business transaction makes marginal sense for Yahoo! given the local-focus of Groupon. Yahoo! understandably wants to own awesome content and can provide huge distribution to Groupon. But so can a lot of companies. I see a traditional player in the local advertising space buying Groupon, with a higher willingness to pay and more ways to leverage feet-on-the-street salespeople to help Groupon expand it’s footprint from a merchant and market perspective. Nonetheless, the news story was not completely surprising.

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