Day 56: Yahoo's Sacred Cows Are Spared!
The Wall Street Journal’s Kevin Delaney had a nice round-up story yesterday about the slowness of Yahoo CEO and co-founder Jerry Yang’s 100-day Vision Quest to turn around the company, a story we have covered obsessively in this blog.
The summary: Not much change coming for the company, which Yang promised to clean up, noting there were “no sacred cows.” And that means the stock will likely continue to languish, which–as I wrote about in this post–could be dangerous if it starts to drift well below $20 a share. It is now just above $23.
The piece also repeated one consideration Yang was making to outsource its search-ad business to Google, news of which appeared in BoomTown a month ago.
As I wrote then:
According to rumors circulating around the company, Yang and other executives at Yahoo are even considering something as massive as offloading some of its search monetization business to rival Google.
“I have suggested this option here in this column many times. Such a move, even if done in part, could instantly add a whole lot of dollars to its bottom line, drastically cut tech costs and remove the focus on its constantly losing fight with Google as a tech leader.
“Better still, it would put Yahoo in a position to focus on its more competitive assets, such as outstanding media properties like Answers, Flickr and a range of tools and features that Yahoo does better than Google and many others…
“While the idea might seem ludicrous, given how much time and effort Yahoo has put into redoing its search monetization system, which is just now showing stronger results, if true, it is interesting that the company is considering its options as broadly as this.
“In fact, despite their much-hyped rivalry, Google and Yahoo have met many times on this issue, said sources, about what such an arrangement would look like.”
But guess what, according to Delaney? Yang decided against such a move. Another cow spared!
Other than that, it’s pricey think-deep-thoughts consulting and now a playing down of that 100-day declaration. One irony: Neither the cows nor the 100-day promise were supposed to be in Yang’s script for that second-quarter investor conference.
But Yang added them at the last minute to the horror of some advisers who thought it dangerous to make such claims he would be called on later to back up.
And still, Yang is not talking to anyone, except for allowing the company spokeswoman (Hi, Jill Nash!) to make the following deftly meaningless statement in the Journal article:
“Jerry Yang and Sue Decker are committed to making significant changes to the way Yahoo operates, and to sharpening its focus on key initiatives that will enable the company to improve its performance and strengthen its position as the most open, vibrant online marketplace for consumers, advertisers and publishers.”
But here’s the true factoid in the story that riveted me: “Yahoo’s 463 million users world-wide at the end of last quarter represent a massive audience it can tap for ad dollars.”
As one top Yahoo employee said to me recently about Yahoo’s amazing audience size and, as I have said many times, its many excellent products: “If we can’t figure out a way to make a lot more money with that kind of traffic and reach, we all should pack it in.”
And don’t miss our video from yesterday with a panoply of Silicon Valley players giving advice to Yang (WSJD: What Should Jerry Do?) that sounds pretty good after Delaney’s report, which is reposted below:
Please see this disclosure related to me and Google.