So ‘Visionary’ co-founder Jerry Yang has left Yahoo (FT 18th Jan 12) Five months back Carol Bartz was sacked and, a few weeks back, Scott Thompson from PayPal was appointed as CEO.
Yahoo will undoubtedly become a business school case study in how not to do it. It was an early leader in how to index and use the internet back in the 1990s. It was worth over $100b at one time. But it got overtaken by a raft of new competitors as it failed to adapt. Google, and now Facebook, have taken much of their revenues. But Yang’s worst decision came in 2008 when he rejected a $47.5b bid from Microsoft. Yahoo is now valued at just $19b. The real value of Yahoo today is not its internet business – it is its stake in Yahoo Japan which could be sold to Alibaba and Softbank for up to c$17b.
What now? A sale of the Asian assets and a possible PE bid for the core are certainly the main possibilities. Yahoo still has some great content – I use Yahoo Finance throughout the day. Ten years back I paid thousands of pounds for all that real time financial information – now its free (and a lot better!) That is, of course, at the root of Yahoo’s problems.