Activist Eric Jackson and other frustrated Yahoo shareholders won big at the Yahoo! Annual Meeting yesterday, even though the company's recommended slate of directors still passed. Persuading nearly a third of normally rubber-stamping shareholders to vote AGAINST management is a major success, and one can only hope that Terry got the message.
Terry's remaining supporters usually point to the stock's having gone up a lot since he joined the company and suggest that Yahoo's current woes are merely a temporary lull that all good companies go through. This defense ignores that the average stock in the industry is up a lot, too (NASDAQ has doubled), and that a competitor that barely existed when Terry joined the company is now worth 5 times as much as Yahoo.
Yahoo's failure to maintain its lead in search and instead concentrate on more traditional media efforts was a colossal strategic error that Yahoo's shareholders will forever have to pay for. Everyone makes mistakes, of course, and Terry's experience helped Yahoo through a challenging period after the dotcom crash. The skills required to return Yahoo to Internet greatness now, however, are different than those that helped stabilize it in the bust.
Terry believes he has the Internet-greatness skills, and he's certainly been paid as though he does. Despite his confidence, however, every day that goes by sees Yahoo fall further and further behind. So no wonder a growing number of shareholders think it's time for a change.