Organic SEO Blog

231-922-9460 • Contact UsFree SEO Site Audit

Wednesday, December 06, 2006

Yahoo Shakes Up Management and Company.

The Yahoo Panama implosion continues.

Summary of MarketWatch story with updates from Peak Positions

Yahoo CFO Decker to switch jobs, report directly to CEO Semel; COO resigns.

Yahoo Inc. is revamping its operations and reshuffling its executive ranks as the Internet giant struggles amid stiff competition from Google Inc., but the moves continue to fall far short of expectations.

The one-time $400 a share YHOO stock now trades at 26, and has fallen more than 30% this year. Yahoo will reorganize into three units, one focused on building its Internet audience, one that will deal with advertisers and publishers, and a third group that will develop technology and products for the other two units.

The turmoil at Yahoo includes the departure of Chief Operating Officer Dan Rosensweig and Lloyd Braun, head of Yahoo's media content group. Braun was brought to Yahoo from Hollywood by Yahoo Chief Executive Terry Semel to create original news and entertainment content.

Susan Decker, who has served as Yahoo chief financial officer since 2000, will become head of the company's advertiser and publisher group, giving her control over nearly ALL of the company's revenue-generating businesses. Many believe Decker is to become Yahoo CEO.

Growth at Yahoo, which for years has owned the most-visited group of Web sites, has been eclipsed by Google, which has come to dominate the lucrative business of selling online ads alongside Internet search results.

Yahoo has grown unwieldy and bureaucratic, critics inside and outside the company have charged, and its offerings in the fast-growing segment of social networking sites have been outpaced by upstarts such as MySpace, now a unit of News Corp., and YouTube, acquired by Google (GOOG).

Giving more responsibility to Decker and the sudden departure of Rosensweig, who will leave at the end of March, may help Semel deflect loud crys for change at the top.

The moves are "very likely a necessary step that carries the potential for improved operational efficiencies at the company," Mahaney wrote in a note to clients.

Yahoo will begin a search for a new CFO to replace Decker and for an executive to head the Audience Group. The Technology Group will be led by Farzad Nazem, Chief Technology Officer at Yahoo since 1998. The heads of all three groups will report directly to Semel.

Still, Yahoo is in for a tough fight to regain its footing against Google, it's chief rival.

Yahoo's sales for the third quarter ended in September rose 20% to $1.12 billion, falling short of its initial forecast on weaker-than-expected online ad sales. By contrast, Google's third-quarter sales rose 70% to $2.69 billion, and its shares have climbed almost 20% this year.

Decker will continue to oversee Yahoo's Marketplaces business unit as part of the Advertiser & Publisher Group, which will focus on the "transformation of how advertisers connect with their target customers across the Internet."

Yahoo said it expects to complete the reorganization by the end of the first quarter, with the leadership changes to be effective Jan. 1. Decker will continue to serve as CFO while the company looks for a successor.

Semel said Yahoo plans to drive growth and profitability by creating "a full-fledged advertising network, with a marketplace that meets supply and demand both on Yahoo's valuable owned-and-operated network and across the entire Internet."

??? whatever ??? how about increasing the quality of Yahoo search results and driving more content relevance throughout the old and tired Yahoo keyword search system.

Improving search results might actually serve users and help Yahoo return improved search results, thereby driving search traffic, page views, SEM click thrus and market share. When will Yahoo stop trying to be all things to all users and instead return their focus to keyword search.

Keyword Search is only the second most popular online activity.

Yahoo still maintains dominance in the most popular online actitivy: email retrieval however, their decision to abandon keyword search continues to result in keyword searchers and market share abandoning Yahoo.


The e-world still remembers Terry Semel's and Yahoo's decision to augment and fill out Yahoo search results with Google search data. In turn Semel and Yahoo helped create Google Mania. Yahoo has been flaming out ever since.

The once proud, dominant keyword search market leader now has to fight with the many also rans for search scraps.

On their knees they remain at Yahoo tired and hungry poor souls seeking a mere slice of the pie they created.


Last month, in its third-quarter financial report, Yahoo noted that its offerings to users and businesses fell into four categories: search, marketplace, information and entertainment; and communications and connected life.

Frustrations at Yahoo were recently made clear in a memo written by Yahoo senior vice president Brad Garlinghouse in November and circulated to key executives.

In the so-called "Peanut Butter Manifesto," Garlinghouse claims Yahoo has a bloated management structure with little room for accountability and had spread its investments too thinly - like peanut butter across bread -- to be competitive.

Yahoo's business endeavors range from email to Internet search to online dating services and digital music.

"Change is needed at Yahoo, and it's needed soon," Garlinghouse wrote in the memo.

Among other efforts, Braun was able to get Yahoo to contribute original content to enhance its aggregated content.

Industry observers have said that Vince Broady or Scott Moore, who have reported to Braun, could be picked to take over for him. Earlier this year, Yahoo brought in GameSpot founder Broady to head the games and entertainment. Moore runs news, finance, technology, sports and lifestyle.

"Over the last two years, the Yahoo Media Group has developed and launched a ground-breaking template for the next generation of media experiences on the Internet," Braun said in a statement.

"There is much more to come in the months ahead. I am proud to have led this team of extraordinary professionals, and I wish Yahoo the greatest success in the future."

More developments are sure to occur at Yahoo as 2006 closes out.