Yahoogle: No Joy in Mudville
by Kara Swisher
Posted on June 12, 2008 at 6:10 PM PT
Here’s an email I got from a high-ranking Yahoo (YHOO) employee today after the Microsoft (MSFT) deal was declared dead and the ad-outsourcing deal with Google (GOOG) announced hours later:
“Out of the frying pan, into the fire. At least, the frying pan was a slower death.”
And here’s an email from a major Yahoo investor–no, not Carl Icahn!:
“The Board and Jerry are idiots.”
And those are people who presumably like Yahoo, since they work there and buy its stock.
Well, both got a big dose of disappointment today, as Yahoo shares dipped to $23.50, losing 10% of their value.
It’s just as ouch as that old pick-up line: “Did it hurt when you fell from heaven?”
Yahoo, of course, has fallen from a little lower in the stratosphere.
But the abandonment of a $33-per-share deal that Microsoft might have meant is gone, baby, gone and the prospect of a lot of negative attention over a questionable partnership with Google adds up to a lot more turmoil ahead.
Of course, turmoil has been the weather forecast for Yahoo for far too long now.
And there is possibly more to come. Many, many sources told BoomTown to expect more major departures from Yahoo’s ranks, including from its board.
According to people familiar with the situation, not every board member was thrilled with Yahoo’s Google alternative.
But not every board member, like a lot of Yahoo employees, has a lot of control over the troubled Internet company.
Follow Kara on Twitter | Follow AllThingsD on Twitter
Comments
Kara:
Plenty of arm-chair QB’s harping about all the talented people that are jumping ship now. Weren’t these the same talent that contributed to the ‘fall from grace’ of this company?
Well, it is possible that these guys that are jumping ship now did not have the power to change the course. But, then again – why did they stay on until now if they did not quite believe in the course?
If anything, this last 4 months should have gotten the mgmt more focused (although they could do a better job articulating that strategy) and should entice this ‘jumping-ship talent’ to stay on. But then, they must be looking for another place where they can warm their backside for a few years without delivering!
BTW, after all the pieces hammering away at poor old YHOO management I think it is time for you to do one articulating your thoughts on MSFT management. Were they really serious about that $33 offer? Do they really have a clue as to what they would like to be when they grow up? What is the thought process that goes into pursuing a $45b acquisition target and then changing course? (I put more thought into what I have for breakfast!)
PS: I am a YHOO shareholder – so no I am not sympathetic to YHOO management’s cause!
Posted by Sudheer Shetty at June 12th, 2008 at 8:39 pmS:
I have written extensively on how this botched takeover deal was a real miss for MSFT…try “Nightmare on Microsoft Street” and “A Deal Must Be Done.”
And more.
But, frankly, if you are a regular reader, Yahoo’s management travails have been a topic for a year (the 100-day countdown!).
And while the people leaving might have issues, as far as I am concerned, the buck stops with Jerry Yang, Sue Decker and the board. Any issues below them are due to their leadership or lack thereof.
Posted by Kara Swisher at June 12th, 2008 at 9:25 pmK:
I have been reading your coverage ever since this saga began. Your web-site is my first-stop shop for anything YHOO-MSFT related (In fact u should be sharing some of that advertising revenue with me!). Thanks for the excellent coverage.
That being said, I felt that the coverage was skewed towards MSFT to a large extent – so I decided to register and post a comment today as a footnote to this whole saga.
I completely agree with you that the buck stops with Jerry Yang, Sue Decker and the directors. They have had their ‘heads in the sand’ for way too long. It was ridiculous when they came out of their 100-day hibernation with not so much as a peep. Time to ‘jump ship’ for any talent worth his salt was right then – because it either meant your ‘talented’ voice was not heard – or may be like I stated earlier – talent was just warming the bench.
Another contingent that should take some blame is all the large institutional investors. If a guy with 100 shares can cause the kind of ruckus during last shareholders meeting, is it too much to expect some ‘fiduciary nads’ from the big shareholders (I am sure they will show some during this years meeting)!
Again, thx for the excellent coverage – looking forward to the book!
Posted by Sudheer Ravindra at June 12th, 2008 at 10:07 pmSeems more like Boohoogle – what happened to your glasses? Lost in the mud?
Posted by Mrinal Desai at June 13th, 2008 at 10:52 amThat’s because Joy is in Santa Clara. Ha, Ha, bad joke, I know. Get it? Bill Joy? Sun Microsystems? Oh, well, nevermind.
Posted by rod sandcones at June 13th, 2008 at 11:33 am