The buying of CNET: Too expensive and not enough room for cost-cutting

CBS Corporation’s decision to splash out nearly $2bn on buying CNET Networks was always destined to be chewed over.

Here’s James Surowiecki in the New Yorker offering a consensus view of the deal: it’s too expensive, and there’s limited room for cost cutting. To make it all work, writes Surowiecki, CBS will need to “improve CNET’s performance not by a little but by a lot”.

Surowiecki recalls Warren Buffet’s old suggestion that that CEOs frequently see the companies they acquire as “handsome princes imprisoned in toads’ bodies”.

They need only a “managerial kiss” to be set free.

Unfortunately: “Most toads turn out to be as warty as they look, and magic kisses are harder to bestow than executives think.”