Struggling Yahoo has poached it's latest CEO (the fifth in just five years) from Google. Marissa Mayer, until yesterday in charge of "mapping" at the Cookie Monster, resigned over the phone and starts her new job this morning. Yahoo's latest figures are also due to be published later today and are expected to be diabolical. By Martyn Warwick.
The revolving door to the chief executive's office is a thing of speed and wonder, no sooner does one poor sap make it through the whirling maelstrom and stagger dizzily over to the desk of power and pain than he or she is flung out through that self-same revolving door, usually with the unsolicited help of the company chairman and his monogrammed cattle prod.
Ms. Mayer was Google employee Number 20, had been at the company since 1999 and was vice-president of "Local, Maps & Location Services". According to industry gossip she had hit the glass ceiling hard and "was not regarded as potential C-suite material." She says she relishes a challenge - and she's certainly landed herself with a doozy.
Yahoo is fading fast. It is a laggard also-ran in web search and seems to have given up on developing that vital part of its business to concentrate on being yet another 'me too' "digital media company" - whatever that means today or whatever it might mean tomorrow, or next week, or next month...
Yahoo is in desperate need of a makeover and relaunch. The power of its brand has waned mighteously in recent years and the company continues to lose market share to Google and Facebook - despite being in a much-trumpeted partnership with Microsoft's Bing.
If these issues cannot be addressed, and addressed quickly, Ms. Mayer will have little choice but to spend big on originating content within Yahoo itself and also to partner with entertainment organisations that can provide compelling content and increase the number of visitors to the site. Yahoo will also have to track and manage advertising much more closely and quickly. These requirements will be expensive to achieve and there are lots of other companies out there already following the same well-trodden path, so nothing particularly new there.
Marissa Mayer will have to innovate and no doubt she will be expected to use the experience she gained at Google to drag Yahoo into the second decade of the 21st century. However, she is facing an organisation under extreme pressure and renowned for corporate in-fighting, politicking and the savage defence of individual fiefdoms. She'll have to recruit talented new blood and prove very quickly that she can be very tough when it comes to swinging the axe against entrenched and stagnant interests.
Unsurprisingly, morale at Yahoo is at rock bottom.
The company's last three CEO's left under great swirling curds of cumulo-nimbus: Jerry Yang was forced out after overstaying his welcome by several years, potty-mouth and aggressive Carol Bartz was fired over the phone (the chairman seems to have been to scred to face her in person) and Scott Thompson had to go because he was 'economical with the verite' on his curriculum vitae.
Ross Levinsohn, the interim CEO who had been doing a creditable job of running Yahoo since Scott Thompson was forced to walk the plank, has been passed over and seems to have disappeared from view. No doubt he is considering his future. Does 'more time with the family' loom for him?
Interestingly, idustry scuttlebutt has it that Marissa Mayer was not Yahoo's first choice as new CEO. The company had been wooing Jason Kilar, the CEO of Hulu, but he resisted the blandishments and declined the offer.
Now Ms. Mayer (who is 37, six months pregnant with her first child and will be taking maternity leave in October) has picked up the poisoned chalice. How long she'll be able to hold onto it is anyone's guess, but Yahoo's dysfunctional board will be expecting her to impose a new strategy very quickly indeed. Or maybe they won't. It's impossible to second guess the antics of that bunch.
For a new broom, Ms. Mayer (or more probably Yahoo's s cliche-ridden PR department) trotted out the usual, unimaginative and palliative guff. This is the announcement: "I am honoured and delighted to lead Yahoo, one of the internet's premier destinations for more than 700 million users. I look forward to working with the company's dedicated employees to bring innovative products, content, and personalised experiences to users and advertisers all around the world."
How many times have we all read such pointless and inane generalities? Why couldn't she mark her arrival by saying something like, "Right, I'm here and I'm going to go through this company and its structure like a hot knife through butter. I'm going to shake Yahoo by the scruff of its neck and whatever falls out will be left on the ground where lays. This is a sea change, I'm in charge and things will change from the moment I arrive at work tomorrow." Had that been the case, the modest upswing in Yahoo's share price of just two per cent might well have been greater and longer lasting.
This reaction by the market (the announcement of Ms. Mayer's appointment was made after trading hours) was understandably muted given that, as of this morning and before the latest financial report is published, Yahoo is now worth less than US$19 billion. In 2008, when Microsoft was uber-keen to buy the company, it offered $44.6 billion. How's that for destruction of shareholder value?
And what about a possible sale of Yahoo or a merger or the making of acquisitions? Who is to say that Google won't try to buy Yahoo at a knock-down price if things continue to go badly. Or might Yahoo buy RIM? Stranger things have happened in the weird, wonderful and wacky world of the web.
Marissa Mayer now joins the brief roster female leaders in high-tech companies alongside Meg Whitman of HP, Virginia Rometty of IBM, and Sheryl Sandberg, the COO of Facebook. That said, and given Yahoo's appalling reord in picking CEOs, would anyone bet real folding money on her being there in 12 months time? Five in five could easily become six in six.
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