OK, Yahoos...Time To Help Fix The Company!

All right, enough wallowing in depression. It could be worse. The stock could be zero. Yahoo’s still a great brand with 500+ million global users a month. So, fellow Yahoos, let’s put our heads together and fix this company!

(Yes, believe it or not, I’m a Yahoo now! That was me in the Sunnyvale chow hall last week. I’m contributing to a forthcoming Yahoo Finance / Video project–at least until Jerry gets sick of my bellyaching and tosses me onto the layoff heap. I’ve loved/admired this company since 1995, so it’s great to finally be a part of it).

We peons know better than anyone else what needs to be done to fix Yahoo, so let’s give Jerry, Sue, and Blake some free advice. They could pay McKinsey a few million bucks for the same info, but then 2008 cash flow would be even worse. So, we’ll just weigh in here. (Just post to the comments below, or send me an email at [email protected] and I’ll add to the post). For obvious reasons, anonymous contributions accepted. I’ll start us off with a simple suggestion below and add more in the following days.

(We did this with AOL a while back, by the way, and it was a huge success. Dozens of passionate, smart ideas from inside and outside the company, including those of ex-employees. Hopefully we can get a good exchange going here, too.)


Provide exact financial details on “core businesses”. Jerry, Sue, and Blake talked a lot about the strength of the “core businesses” last night–that is, the owned-and-operated properties, excluding Overture Japan, the broadband deals, etc. They threw out lots of sexy numbers–query growth 10%, revenue-per-search growth 20%,  search growth 30%–but without exact details, it was hard to put these numbers into context. If there’s really a pony in there, let’s show it to the world. So…

  • Provide a “pro forma” financial statement with an 8 quarter trending schedule showing the revenue and cash flow of the “core businesses” as you define them. Provide footnotes showing exactly what is included and excluded (i.e., how to reconcile with the GAAP statements). That way, if the core businesses really are strong, we’ll all be able to see it.

Hire Tim Koogle–Yahoo’s CEO in the 1990s–back as a consultant. Tim?

Company’s in great shape and doesn’t need fixing!  You’ve got to be kidding me – approx 7.2B revenue, 500M (audience per month) – and only $18/19 per share?? We have all the talent and tools necessary to capitalise and monitize a sound strategy – that is able to compete with and surpass that of Google. 2008 will be the defining year for Yahoo! By the way – we do love Tim. He is very well respected throughout the organisation.

If SAI and Blodget shut up, Yahoo will be fine:
In the past, you bashed Yahoo everyday, please stop bashing Yahoo, and they will be fine. Yahoo is still a good and solid company.

Hire consultants and/or buy software.  Ever heard of the Adaptive Enterpise work done at IBM? It has saved IBM literally billions of dollars through a project called Workforce Management Integration. In an industry all about the future, it might be what Yahoo! needs to make swift, effective changes in their organisation.Either develop your properties/brands, or kill them off. Stop letting your properties stagnate, i.e., Yahoo Mash, Kickstart, Bix, Jumpcut, MyBlogLog. They all seem to have disappeared off the face of the earth. If they are not part of the solution, dump them. Concentrate on aggregating information and building online communities, both of which Yahoo is known for. Reestablish your identity and stop playing the role of Google’s ugly stepsister.

Stop playing Carousel of Business Strategies and take the company private. Google has a simple strategy. They would like to put ads everywhere — in all languages, in all channels, on all platforms. Does anyone doubt that? As for Yahoo? They have a different strategy every 6 months. Buzzwords like “start page” for the web that come out of some offsite isn’t going to get the job done. We all know people that work there. The morale is so low that it’s impossible to overestimate the effect. They need to be taken private and develop a strategy that puts them back on a growth footing.Figure out what people like about you and shoot everything else.  And outsource search to Google.   How the hell could it take 10,000 people [14,300, ed.] to operate this company? They have 4 or 5 things people value and about 100 things nobody knows or cares about. Clean things up. And the most obvious idea—-outsource search to Google and get back to the portal content business. Take your medicine and at least make some money

Just put your ad units in better places on the page–and collect another $500 million a year.  One thing they can do for sure to increase revenue significantly is to work on ad placement in terms of getting higher click rates. As someone who buys remnant media regularly from them I can guarantee they can increase revenue by making more prominent placement for remnant ads, by at least 500% on remnant, which is definitely over $500 million a year.

Give up and sell the company.  The multi-millionares running this company have been given MORE than enough time to ‘right the ship’. The rally cry is now, ‘well… we will get ’em in ’09’? As a sizeable shareholder, I prefer them put the company up for sale NOW. This should be done publicly. I can only hope and pray for a bidding war to drive the share price up. Jerry Yang should think about his fiduciary responsibility to the shareholders getting creamed as the share price languishes at a 4yr low. Let’s go… Microsoft, AT&T, News Corp, Time Warner, Comcast, Baidu, Berkshire Hathaway (OK a reach.. but, Warren-Sue connection???), Private Equity… ANYONE! I dont care.. I want a share price north of 25 and I dont care how we get there anymore. I am sick of waiting!

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