June 19, 2007 |
Yahoo! CEO Terry Semel announced he is stepping down and that Co-founder Jerry Yang will be assuming the every day duties of chief executive. Yahoo! has faced some tough times over the last couple of years and the company's investors have become increasingly restless as Yahoo!'s growth has continued to slow. Shares of Yahoo! have faltered this year from $43 a share to less than $30. Yahoo!'s battle with Google over a share in the market has not been a successful one.
This announcement via the New York Times comes less than a week after a Yahoo! meeting where fully one third of their shareholders voted against re-electing one or more of the company's directors and also took issue with Semel's rich compensation package. Semel's resignation is the second high profile resignation this month as Parzad Nazem, the chief technology officer left on June 8th. Semel's retention package last year became a thorn in the side of investors when it was announced he would receive over $107 million in salary and bonuses.
Irony and Lateness
Google actually got its first break from Yahoo as Semel who utilized Google's search early in his tenure. Semel realized too late the potential for Google to take over the search venue and the former Warner Brothers executive has been playing catch up since then. According to this article Semel appears to have been a step behind in virtually every attempt to catch Google; with the introduction of the $2 billion dollar Inktomi acquisition (an already obsolete search company), the late deployment of Panama and other "stop gap" measures Yahoo! has just maintained the second spot.
In With the Good Air
Jerry Yang may not be a breath of fresh air but he was one of the original Co-founders and the creator of Yahoo!'s original search. Yang and David Filo founded Yahoo! back in 1995 and Yang has occupied a number of posts at the company over the years. Semel told stockholders that the company needed new leadership with a whole new skill set in order to improve its track record and Yang obviously possesses a more technically oriented perspective.
Rumors and Possibility
Persistent rumors of a Yahoo! – Microsoft merger or takeover have been in the news lately but the realization of this "tag team" to beat Google has not gotten past the drawing board. Most experts cannot put together a way that a combination like this could resolve online product and service overlaps. Neither company possesses a property of innovation that the other really needs but many view some merger of this type as the only way Google can be challenged. It will be interesting to see what Yang comes up with to revamp or accelerate Yahoo's reach and the expansion of their branding worldwide.
Photo Credits: Semel and Yang courtesy Yahoo! News