An Interview With Yahoo’s Jerry Yang, Part 2: On Opportunities, Carl Icahn and Leadership
by Kara Swisher
Posted on October 23, 2008 at 5:00 PM PT
BoomTown was a squeaky enough wheel to get Yahoo CEO Jerry Yang to grant a long interview by phone yesterday–just a day after he had announced weak third-quarter earnings results for the Internet giant, caught as others are in the econalypse, as well as layoffs of at least 10 percent of its global workforce.
But instead of being glum, as you might expect, especially after a year of corporate turmoil that would have finally gotten to even Job–let’s review: management upheaval, a Microsoft (MSFT) takeover battle, an attack by billionaire shareholder activist Carl Icahn, tangling with the Justice Department over a pending Google (GOOG) search advertising partnership and more!–Yang sounded surprisingly confident that Yahoo (YHOO) would emerge a winner after all the wrenching change is wrought at the company he co-founded.
I split the interview into two parts (here is the first post on Yahoo’s financial performance, the impact of the bad economy and the layoffs).
Here is the second part, in which Yang talks about acquisition opportunities, although no comment on his talks with Time Warner (TWX) online unit AOL; his relationship with Icahn, who now holds a Yahoo board seat; the status of the controversial Google deal; his take on Microsoft; and, most importantly, why he is still the right person to lead Yahoo.
BT: What about acquisitions? Everyone knows you are talking to AOL, but what else are you thinking about here?:
Yang: I am not going to comment specifically on AOL.
But, in general, when the market is going through what it is going through, we have to be making adjustments all the time, because things are different than they were even three or four weeks ago.
But I like a lot of things we have going for us in the current situation. We have no debt. We have a strong cash position. You have to ask what is going to happen to a lot of companies when there is not a lot more money to be gotten. That changes everybody’s perspective, I think. And we think we can be opportunistic.
We have not bought back stock. Right now our stock is very cheap, but we think having our cash position is more important. We are very focused on scaling, and it is important to be able to be in a financial position to do so if opportunities come up.
BT: And how is your relationship with Carl Icahn going?:
Yang: Carl is fine and he has got a lot on his plate as well. But he has been a very useful person to have on the board and, of course, it is a different role for him than before. For the most part, he is very constructive, but he is still Carl and he doesn’t hesitate to share what’s on his mind.
BT: What is the status of the talks with the Justice Department over your search ad deal with Google?:
I don’t have a lot of new things to say. We’re still talking, as I have said, and hope to get things resolved. We have not started it, but no one has walked away.
BT: What about your relationship with Microsoft; what did you think of CEO Steve Ballmer’s comment last week about doing a search deal?:
Yang: I don’t have anything new to report there either. As we have always said, we are willing to listen to them, to talk to them about anything.
BT: You have been attacked a lot recently for not selling Yahoo to Microsoft, Yahoo’s low stock price and your management of the company–why do you think you are the best leader for Yahoo going forward?:
Yang: I think if you look at what the company is doing and what we have been going through and the story we have been telling, we have done most, if not all, of what we set out to do, starting last year.
My dream is to transform Yahoo as a platform and product company and I think we are on the way to really doing that. And a lot of what we have been doing is starting to translate into value–whether it is our front page, our profiles, our email or our APT ad platform.
And, in this uncertain environment, I think I am absolutely the right person. Times like this require a leader who really understands this company and its customers, and I think I do. The world is a different place today than even a month ago and I think I am the best person to guide Yahoo through this volatile time.
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Comments
Kara,
Congrats on getting Yang to something, he usually hides behind press releases that are meaningless and usually say nothing. Not that his answers to you were any more forthcoming, but I’m cracking up over his answer to your MSFT question. And I’m in stitches over his response to if he is the right leader. Is he serious, when he says “we have done most, if not all, of what we set out to do”. Is he kidding me? He turned down $49 billion and todays market cap is just over 16b. What exactly did he “set out to do”, ruin the company. He is totally out of his league and needs to get fired ASAP.
Posted by Mike Kane at October 23rd, 2008 at 7:45 pmM:
Well, we will see what happens, but I thought he should be able to speak about what he thought of his performance.
Posted by Kara Swisher at October 23rd, 2008 at 11:01 pmAs was to be expected, you achieved getting nothing of any substance from Jerry Yang, except the usual Yahoo fluff. It is simply amazing how this arrogant, foolish and incompetent excuse of a CEO can claim, “we have done most…of what we set out to do.” What might that be? Losing 48+ billion of shareholders’ money? Yang, Decker, Filo, and the whole board should be imprisoned for the rest of their years on earth. They should all have been kicked out squarely on their rears a long time ago. I lost 60% of my investment in this worthless excuse of a company.
Posted by william olic at October 23rd, 2008 at 11:06 pmIt’s difficult to see in the dark. A place yahoo has been for some time now. It’s no wonder their stock fell. If you are a webmaster you know what I’m talking about. When was the last time you used yahoo analytics, or yahoo search bar to check your page rank. They are falling behind. Oh and how about the new yahoo phone isn’t that wonderful? It’s about the whole experience. Why don’t you just add a yahoo search bar to your website or an ad program that will generate extra revenue. Yahoo is the same system it was 5 years ago. Sure there have been some nice upgrades made here and there, but they are still no google when catering to webmasters. A service that is much needed for the average marketer trying to promote on a low budget. I’ve been using yahoo for the majority of my searches up until the last six months. When the majority of my traffic comes from Google it seems realistic to change my loyalty. Who would you optimize for when the majority of your sites visitors come from servers which constantly pull and update your content in a matter of days not weeks? Just check the stats, it’s no wonder they are losing money for their stock holders. When you can’t provide much needed services to the professionals who fill your databases with content, they too will go somewhere else.
It just seems like they aren’t catering to the right crowed of developers. Where’s the video, the social networking and have you tried a yahoo chat room lately. There was a time when you could login and talk to real people from anywhere, now it’s bots and advertising. Where’s the breaking point?
Jerry Yang shouldn’t be fired, he should be given $1,000 and told to build a website, promote it using the best methods available. Then see where he ends up. He probably would find that Google provides for a much better end user experience. Especially when it comes to low budget services such as analytics, stats and keyword marketing.
At the same time I do realize that yahoo has a lot more going that just a search engine. They do provide some other great services. It just seems to me at the end of the day, I’m finding myself logged into Google instead. I think people are looking for change and Yahoo is just not keeping up with back end user integration for the webmaster. Maybe Microsoft is the solution, but if that happens then look out. Ever 3 years you will need to learn how to use the new Yahoo, reprogram everything you’ve built in a new language. Plus did you ever consider how much it will cost to keep up with it?
Maybe someone who uses Google a lot should take over Yahoo. They seem to know what they are doing when it comes tech.
Posted by Brandon Barclay at October 24th, 2008 at 1:10 amKara, can you ask Jerry about a recent pattern of deceptive business practices. One – they tripled their domain re-registration prices and automatically renewed at the higher price without adequate notification. Also, they seem to have shutdown POP access to mail unless users pay an exorbitant fee.
I’d like to know if these practices are what we are to expect from Yahoo.
Posted by Patrick Colmenar at October 24th, 2008 at 4:32 amNo kidding. They tripled mine. I’m moving them as soon as possible. You see this in a lot of credit card processing contracts to. Where if they are not making x% on your business they have the right to raise your fees without notification to the merchant.
Posted by Brandon Barclay at October 25th, 2008 at 11:53 amYahoo hit $11.25 a share today, and Yang turned down $33, I still for the life of me can’t understand his comments about doing most, if not all, of what they set out to do. What exactly did he set out “to do” ruin the company? He has got to be the worst CEO heading a major company today. There is no excuse for his arrogance. He is utterly incompetent and should be fired ASAP.
Kara, any chance at getting Carl Icahn to comment? He has got to be furious at watching this train wreck.
Posted by Mike Kane at October 28th, 2008 at 10:01 am