30 janvier 2008


UPDATE Friday, Feb 1st: Microsoft has made an hostile offer to buy Yahoo! for 44.6B

Tough time for Yahoo! Earning call today, after the bell, disappointed with a profit lower than expect but also with forecast in the low range of analyst expectations for next year.
Rumor had it as Jerry would announce layoffs as a last chance to make up for Wall Street but the 1,000 layoffs (9% of its workforce) were not enough to avoid the stock to free fall after market by more than 10%. Valued at about $18.50 at the time I'm writing this post.

Jerry Yang miraculous effect, the classic founder comeback, the hope of another Steve Jobs magic move didn't happen. On June 18th 2007, Jerry took back the driver seat at Yahoo!. Stock was $28.12 that day. about 7 months later, the stock has lost $10 a share or 35% of its value. That's about $8B in valuation. Gone.

Jerry asked for 100 days to come up with the re-newing strategy. BlueLithium and Zimbra were acquired, as planned before Jerry joined and Terry was aked to leave. 100 days later, Yahoo! issued an earning guidance below analysts estimates. Time for good news?
Not really. Then came the apologies for the jailed Chinese dissident. End 2007.
CES, in January in Las Vegas, Yahoo! finally announced its mobile focus and the whole company motto of the "best start on the Internet".
And then my friend, Vince Broady left Yahoo! Vince, to me, is a star to me. He co-founded GameSpot, revived mp3.com, created tv.com and more... Over the past 6 months, almost everybody I knew at Yahoo!, here and in Europe, has left Yahoo!

Yahoo! is not alone. CNET and others are in a similar situation. After paper content companies, internet content companies are struggling. Producing content and sticking ads ain't enough for growth anymore. Still a good business to be in, but like every other businesses, maturity brings the need to trim production cost and in a fast aging industry, companies needs to reinvent themselves faster than it takes big ones to re-organize themselves.

Why is Yahoo! not playing in the Social networking arena?
Why is Yahoo! not grabbing a seat at the Video sharing game?
Why is Yahoo! not inventing the new TV that Hulu, Joost and others are shaping up?

Yahoo!, while I never worked for them, is a company I like. Naive and unexplainable, but still, I wish something happen there. It's about time. A Microsoft take over, which at current valuation, is near bargain price, can't be the only way forward, can it?


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