When Yahoo hired new CEO Carol Bartz in January, I was convinced the company was on the turnaround path. I believed the Web services giant was capable of recovering from the mess of mutilated morale Yahoo co-founder Jerry Yang left in his wake following the end of his painful return as CEO. Barring any earth-shattering product announcement, Yahoo is dying a slow death, and the media is assisting in this sad suicide. Neither Google nor Microsoft will have to help.
News Analysis: When Yahoo
hired new CEO Carol Bartz in
January, I was convinced the company was on the turnaround path. I believed the
Web services giant was capable of recovering from the mess of mutilated morale
Yahoo co-founder Jerry Yang
left in his wake following the end of his painful return as CEO.
Bartz put a serious visage on a company that no one was taking seriously
anymore. Despite a robust display advertising business, Yahoo was suffering in
many other areas, and Bartz looked right for the part of savior. But the more I
watch the company's moves, the more I'm convinced it is slowly killing itself.
The media, through its unflattering coverage, is assisting.
Yahoo has made many bids to draw positive attention in the last several
months as it seeks to better compete versus Google, Microsoft, Facebook,
Twitter and other Internet rivals. However, nearly everything it tries is
shot down by the media, criticized for such things as being late to offer
features for its Web services, or just flat-out wrong. The brightest example of
the latter came when Yahoo announced that it had
agreed to let Microsoft's Bing search engine serve as the
back end for Yahoo Search.
Microsoft CEO Steve Ballmer and Bartz
were convinced that they had a winning partnership, only to be humbled by
financial analysts, who were turned off by the lack of an upfront payment to
Yahoo. They didn't care that Microsoft would pay Yahoo 88 percent of the
revenues per search query; they wanted Microsoft to pay Yahoo somewhere between
$1 billion and several billions of dollars from the beginning.
Bartz fueled this fire by telling everyone a deal with Microsoft would take
"
boatloads of money." She again
put her foot in her mouth by foolishly stating
Yahoo
has never been a search company.
Even when Yahoo thinks it is orchestrating a winning move on the
leapfrog-happy Web services market, it finds its enthusiasm curbed by tepid
reception to its plans.
The greatest example of this came earlier this week when Yahoo Aug. 24
hosted a high-level demonstration of
upgrades to its Yahoo Search, Yahoo Mail and Yahoo Messenger
applications at its Sunnyvale, Calif.,
headquarters.
The "What Matters Most"
event seemed
like a great idea from Yahoo CMO Elisa
Steele: Give the media a taste of its new product offerings and then sit back
and let the praise wash over it for its ability to get up to Web 2.0 snuff with
Internet rivals Google, Microsoft, Facebook and Twitter.
That didn't happen. When the Q&A session rolled around,
roughly half of the questions from the media had to do with what
would happen to Yahoo Search when Microsoft Bing begins powering it in 2010.
Here's a sample of an answer to one of several variations of the
what-happens-when-Bing-comes-to-town question:
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