Kara Swisher

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Yahoo CEO Trash-Talks Web Rivals–But That Won't Stop the Company's Troubling Brain Drain

Say what you will about the status of her effort to turn the company around, but Yahoo CEO Carol Bartz certainly has gumption by the truckload.

Which perhaps is not always such a good thing.

Yesterday, for example, in an interview with BBC News, the loquacious exec–who often uses a dramatic rolling of the eyes to make a point–slapped at Internet juggernauts Google (GOOG) and Facebook.

Google, posited Bartz, will be in trouble if it was not successful outside of search.

“Google is going to have a problem because Google is only known for search,” said Bartz to the BBC. “It is only half our business; it’s 99.9 percent of their business. They’ve got to find other things to do.”

Yes, other than collecting that Fort Knox of search earnings!

As to Facebook, which is hurtling past Yahoo (YHOO) in pretty much every metric these days, Bartz is here to tell us that it is just not all that.

“They certainly are taking people’s attention and time,” she said. “But what is kind of wrong about the conversation is that social just means Facebook.”

Actually, social does mean just Facebook if you’re comparing the social networking giant to Yahoo.

In any case, these are comments BoomTown has heard Bartz make many times of late, including at a gathering of journalists earlier this year on the occasion of Yahoo’s 15th birthday.

Also on her hit parade at that event: That it took CEO Steve Jobs many years to turn around Apple (AAPL), and he was “returning to a company he knew really well.”

While comparing yourself to the most visionary tech icon in history–how can I put this delicately–is insane, in general, all this trash-talk is no big deal and it is a classic way to throw focus off your own problems.

That is, except when it comes to yet another meme Bartz recently trotted out about the continuing exodus of execs from the company.

In Yahoo’s first-quarter earnings call last week, apropos of no question asked, Bartz declared that those who focus too much on Yahoo executive talent, or–actually–the departure of executive talent from the company, were “borderline” obsessive.

Frankly, Bartz could not be more wrong and there is not nearly enough attention paid to this, since the departures–which, to be fair, have been an issue well before Bartz arrived–are simply not typical of the churn you find at any other tech company in Silicon Valley.

And while some leavings from Yahoo are not a bad thing, the continuous brain drain is perhaps the company’s most profound dysfunction.

In the last months alone, Yahoo has lost its chief advertising sales person, its CTO and several other prominent techies, such as Chief Technologist Sam Pullara.

And, almost like clockwork, Bryan Lamkin, SVP of the Consumer Products group–who was hired by Bartz just one year ago–said goodbye.

Sources said was due to clashes with Bartz, as well as the recent hiring of former Microsoft (MSFT) exec Blake Irving piece as Chief Product Officer.

Irving’s arrival is certainly good news for Yahoo, but there simply has to be more of that and soon. Simp;y put, the company needs to show the ever-fickle talent pool inside and outside the company that it means business about innovating and staying relevant.

While Bartz can pooh-pooh this all she likes, as the professional manager brought in by its board to clean up Yahoo, she has but one serious job: The nurturing of its talent to do great things once again.

And while a lot of that talent has already scattered across Silicon Valley–a lot to Google and Facebook, in fact, as well as to a spate of interesting start-ups–it’s Yahoo only hope if it expects to thrive.

While Bartz–who is clearly someone who knows how to cut costs and restructure–can talk all she wants about rivals and the need for critics to wait and see, none of that matters unless she can reignite the innovation business at Yahoo.

And innovation only comes through a motivated staff that does not have its eye on the door and the next big thing elsewhere.

In a terrific post this week on his blog on why his venture firm prefers to back companies that have founding CEOs, Andreessen Horowitz partner Ben Horowitz–a longtime entrepreneur himself–made a point that applies to any size company in tech:

“The technology business is fundamentally the innovation business. Etymologically, the word technology means ‘a better way of doing things.’ As a result, innovation is the core competency for technology companies. Technology companies are born because they create a better way of doing things. Eventually, someone else will come up with a better way. Therefore, if a technology company ceases to innovate, it will die.”

So, while Bartz can lecture other companies on a better way to do things–which, of course, she abhors when such practices are turned on her management of Yahoo–it’s pretty much as simple as that.


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There was a worry before I started this that I was going to burn every bridge I had. But I realize now that there are some bridges that are worth burning.

— Valleywag editor Sam Biddle