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During the 90s and early 2000, Yahoo was a true giant of the Internet, leading segments of the email, news and searches on the Internet.
But the fate of electronic media company has changed dramatically with a turnover which rose from US $ 7,200 million in 2008 to US $ 4,600 million last year.
on Tuesday, the company announced it will lay off 15% of its workforce worldwide after reporting a loss of $ 4,300 million in 2015.
the poor state of Yahoo is due in part to Google and Facebook have come to dominate the advertising market online , where the company receives much of its revenue.
in addition, a number executive directors who have been leading the company in recent years have also failed to contain its decline.
This week, Reuters reported that investors want the company to sell its main business after a drop in stock prices.
Some said that this could lead to the dismissal of the current CEO, Marissa Mayer, and even the complete disappearance of the Yahoo brand.
How Yahoo has come to this situation and what to expect in the future?
Early unfavorable?
Yahoo has not always been surrounded by clouds.
Founded in 1994 by students at the University of Stanford Jerry Yang and David Filo, the firm quickly grew to become the first internet web portal , competing with companies the likes of MSN and Lycos.
“It had everything under one roof, combining news and other services to users who were not experts in navigating the Internet, “said Richard Kramer, founder of Arete Research and veteran technology analyst.
the company also he survived the stock market crash of technology companies in 2000 and its sales increased tenfold between 2001 and 2008.
However, according to Kramer, over time, the concept of web portals became “outdated”.
“in its core businesses of search and display advertising, Yahoo saw was surpassed by rivals such as Gmail and Hotmail , and other young companies upstart, messaging apps such as WhatsApp and WeChat, etc .. “.
” the aggregation of news came from Facebook, Twitter and other digital channels such as the Huffington Post or Vice, “says Kramer.
“Yahoo also was relegated searches , opting to partner with Microsoft which tried comprarla- while it was not quick to develop in the field of video and mobile telephony”.
Laggard?
The problem is that Yahoo generated most of its revenue by selling advertising space on their platforms and when its users migrated to other sites, sales suffered .
to make matters worse, Yang resigned as CEO in December 2008 and the signing goodbye to 7% of its workforce a month later.
the company needed to reinvent itself but to replace Yang, Carole Bartz acknowledged that he had the dilemma of what exactly was Yahoo when he took office in 2009.
“we are not a search company. we are not a company display advertising. We are a broad-based web technology that delivers the most interesting content on the Internet to 600 million people, “he said later.
Kramer believes that multiple changes at the top also they helped the firm .
Bartz ç was dismissed in September 2011 and his replacement, Scott Thompson, lasted only four months before resigning after being accused of having falsified his resume.
“they had an eternal succession of management changes at a time when it was essential to keep the ship on course,” Kramer says.
“also were overwhelmed by investors who demanded a change fueling the cycle of managerial replacements “.
And now what?
Marissa Mayer, who has been in charge of Yahoo since July 2012 faces a similar revolt.
you attempted to boost the company with the purchase of firms like Flurry, an analysis service mobile, and Tumblr, a blogging service.
But his activity Home Internet continues to lose money.
In fact, most of the value of the company’s Internet US $ 33,000 million is attributable to its shares in Alibaba, the Chinese e-commerce giant.
After taking back the plan to sell shares of Alibaba, Mayer adopted a strategy to transform the core business into a new company .
But on Monday, Reuters reported that several senior Yahoo shareholders wanted Mayer sold that part of the business.
a source said the executive director had the support of the board but many investors have called for his resignation.
Kramer indicates that the choice is simple: “Either the executive director leaves his position to sell the business, or give you the necessary space to pursue new strategies, while restructuring that was promised to announce the results of 2015 is given “.
” the media like to say that Yahoo is a company that has to make drastic adjustments, but that the wrong way of looking at things, “says the analyst.
” what you really need is to create buy–or entirely new businesses, fasten them to their existing platform and attract new users, “he said.
“that’s what Mayer is trying to do, although the implementation of their plans has been poor.”
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