How Marissa Mayer is remaking Yahoo as an Internet portal

The latest sign of this trend came just this past weekend, when multiple reports had Mayer in talks to acquire the online television hub Hulu. Less than one week earlier, Yahoo announced it would pay $1.1 billion for microblog network Tumblr. Two months ago, the company paid a reported $30 million to buy news digest app Summly from a British teenager.

The common thread: Yahoo keeps expanding into new areas, even though it was already a sprawling internet conglomerate when Mayer took control, with everything from movie listings to stock quotes to a photo-sharing social network to a news hub to a search engine. (And don't forget the "OMG!" section.)

Yahoo's mission creep is a useful case study in why web companies like Google and Facebook continue to grow their functionality and why startups keep selling to the seemingly bloated leviathans, even though tech advances have made it cheaper and easier than ever for software companies and web services to go it alone, and despite the fact that consumers are migrating to highly specialized mobile apps.

Once upon a time, the idea of agglomerating lots of functionality in one website seemed like an obsolete throwback, a vain attempt to carry forward the glory days of the online portal in the late 1990s. Portals had their time and place, but it was in the past, the thinking went, during a transitory period when it was expensive to build the most basic interactive website. That financial barrier gave well-capitalized internet companies the opportunity to dominate many verticals at once.