Garlinghouse Backlash Begins. How-To-Save-Yahoo Debate Ongoing

A few days after Brad Garlinghouse's "Why Yahoo Sucks" memo hit the Internet, the blogosphere has chimed in.  And the verdict is...

1. Terry should go.  Theory: He parachuted in, stabilized company, got everything headed in the right direction--then cashed in a few hundred million-worth of stock options and hit the Barca-lounger. 

2. Garlinghouse should go.  Theory: Not only has he publicly insulted his bosses, he's produced crappy products.  Yahoo Mail?  Lots of people seem to hate it.  Dialpad?  What's Dialpad?  This memo was just a Garlinghouse power-play...

3. Dan Rosenzweig should go.  Theory: He's the weak link, and Terry's just playing loyal boss by protecting him.

4. Sue Decker should be CEO.  Theory: Almost universal agreement that she's the strongest of the bunch. 

I have some personal loyalties here, so I'll maintain an editorial distance.  As a Yahoo shareholder, however, I'm just happy that the company has gotten a good swift public kick in the posterior.  It's time to get the fire burning again...

Comments

[Victor]

Google crashes through 500. Any thoughts on that Henry?

[Victor]

btw I think one of the biggest problems with Yahoo is its composition, both at the bottom and at the top. Where Google is solidly a technology company at all levels, Yahoo is a media company. If that's what they want, then that's the direction they should go, but in doing so they're going to get slaughtered in search, which is where the most money is.

[Henry Blodget]

Let's hope it keeps right on going. It's such a huge piece of my index fund now that every percentage point counts.

[Josh]

Search as a function is essential but its also a commodity.

Why try to compete directly with Google/MSN when Yahoo has so many other great opportunities. Merging with Ebay or MSFT is down right silly. Targets like Linden Research, perhaps even Blizzard Entertainment (battle.net) make significantly more strategic sense.

Yahoo is not just search its a community. Txt based advertising has soooo much hype around it right now but web savvy users don't purchase products through txt based advertising; and the savvy segment of internet users is growing. If anyone wants to discuss this further I would be happy to.

I think Yahoo should just focus on being a community. Yahoo should continue expanding its products such as fantasy sports (best of breed), email, online games (should really expand this area) etc...and at the core of everything expand Yahoo profiles (think social networking). Yahoo profiles should become the center of the business. Everything could branch from your yahoo profile ie....your music tastes, instant messaging, video game profiles, email, local weather, pictures, bookmarking, blogging, groups etc.....I think Yahoo should buy the underlying technology from a vendor but should building the social network on its own, from its own huge community.

What's the deal with the Yahoo AT&T partnership...That should be canned, its a login disaster....

And to monetize this community Yahoo should continue to develop an intuitive txt, banner, and video based ad platform along with some select membership fees (unlimited music ie). They should continue to form partnerships with traditional media. Google is trying to become the Ad-exchange but the problem is Google is hoping that search is going to be the center. I think a community like Yahoo has the potential to be a much better ad-exchange.

Google is definitely right though about Ajax, everything should be coded in Ajax

[Eric]

You're right... what the heck were they thinking when they did Dialpad?

[stock options]

Yahoo needs to quit playing the stock market game and get into the internet game. It is still the largest portal online. Unfortunately their products rarely produce where it counts. Yahoo Finance and Answers are the only programs they have produced that actually compete to be the best. Yahoo's most important program, its advertising program, needs a kick in the butt. Google's advertising program makes roughly double per page view than Yahoo's. This is rediculous.

[stock options]

I just read Henry's comment. Right on! I forgot that their fantasy sports are pretty damn good. And merging with Blizzard would be awesome. Everyone on earth would be playing World of Warcraft.

[former yahooer]

You have it all wrong about Decker. Although she is certainly pleasant and good with the street, her constant analysis paralysis grinds the company to a halt. Numbers over strategy is why they've done nothing. She is only good if they have an awesome, strategic CEO in there. Anyone currently in there that is related to strategy should be canned -- including the whole crappy Toby Coppel Corporate Development group. A bunch of idiots.

[Jeremy]

Yahoo mail Beta is best on the net, what are you talking about?

[fCh]

I ahve been a Yahoo! user for more than a decade now. Their ads just drive me crazy--how many times they've tried to sell me mortgages, cars or things that have no relevance whatsoever to what I am doing at Yahoo properties or want. Now, had their stupid ads been not so taxing (they are all Flash and Java heavy and take up so much of your screen) I might have gone along. But they just forced me to go Google's way, for it's Google's ads that I can most of the time ignore and/or rarely follow.

Henry, your observation about savvy internet users trends are right on the mark. Ignoring them cost the house at MSN and AOL and, as you point, even the old AOL users get savvy with time.