Marissa Mayer’s Plan for Yahoo Takes Hold

http://www.nytimes.com/2015/01/22/technology/personaltech/marissa-mayers-plan-for-yahoo-takes-hold-the-question-now-is-time.html?referrer=

by smacktoward • 12 years ago

87 53 12 years ago

nytimes.com

LandoCalrissian2• 12 years ago

What Mayer has been tasked with is an almost impossible mission, just stopping the free fall is impressive in it's own right. People really love to dig on her, and I can't help but think it's largely because she is a woman. She's clearly not perfect and can be pretty callous towards employees, but it's not like she is the first CEO in tech to behave that way.

I don't know what the future for Yahoo holds, but it's hard for me to say that she has done a bad job so far.

jonnathanson• 12 years ago

"People really love to dig on her"

True, but that's not really what this article does. It's mostly supportive.

LandoCalrissian2• 12 years ago

Sorry, should have made myself more clear. Wasn't trying to directly address the content of the article, which is largely positive as you said.

Someone12342• 12 years ago

think it's largely because she is a woman

Really? I haven't read anything like that.

Seems to me most of her critics are from people who want Yahoo! to sell (or merge) so they make tons of $$$$$$. Before she came in they were set to strike it rich as Yahoo! went down in flames, now their money is tied up until she "fails" (from their perspective).

These people have just lost faith in the company after several consecutive failed executives promising similar things to Mayer. If she actually made Yahoo! profitable again they'd likely change their tune pretty quick, but she hasn't just yet, and she's spent a lot of "their" capital buying other companies which has further upset them.

Honestly I've seen very little "she's a woman" criticism, and rather a lot of broad criticism about the overall strategy. Although there has been a discussion of her interpersonal skills (however I've also read that about a lot of other, male, CEOs).

andkon• 12 years ago

It's called the glass cliff: http://en.wikipedia.org/wiki/Glass_cliff

She takes over after years of neglect at a time of even more substantial crisis, and yet gets and will take far more of the blame than her very incompetent predecessors for Yahoo's failure. What's worth wondering is whether her being a bossy boss woman was also responsible for her being sidelined and pushed out from the OC at Google: http://www.nytimes.com/2012/08/23/technology/in-googles-inne...

freehunter2• 12 years ago

Well of course no one is going to say "she will fail because she's a woman". Bigots have learned to be a little more subtle than that. They would just criticize her strategy, while the same strategy from a male wouldn't draw the same criticism.

I'm not saying that is what is happening here or that Mayer's strategy shouldn't be questioned, just responding to the "no one said 'because she's a woman' so it can't be sexism"

taxidrivermoe• 12 years ago

This could be called a nitpick, but it's kind of an important one. You say "made Yahoo! profitable again" as though Yahoo! were unprofitable.

Yahoo has been profitable to the tune of over a billion dollars a year for a LONG time.

http://ycharts.com/companies/YHOO/net_income

jusben13692• 12 years ago

My sense too is the "first time CEO" problem that's unavoidable. I think some of her public known missteps are just a function of being a rookie and something you see from nearly all first time CEO's of large companies.

discardorama3• 12 years ago

People really love to dig on her, and I can't help but think it's largely because she is a woman...

I agree. This article is very positive, but in the past, when I've read a lot of her criticism, I have often wondered: is this being said because she's a woman? Would they be saying similar things if she was a man? And the answers, often, are "yes" and "no".

phamilton• 12 years ago

I'd say that she is a prominent person in tech. Prominent people in tech get a lot of attention, good or bad.

One reason (among many) she is prominent is the fact she is a successful woman in tech.

In other words, I don't feel the criticism is because she is a woman, but I do think she's more in the spotlight than her predecessors because she is a woman.

jkot• 12 years ago

I think people are being very nice to here. There is some parallel with Nokia.

bane2• 12 years ago

and I can't help but think it's largely because she is a woman.

Maybe. When she first came on board, there was lots of gossip about her having a baby and being a CEO and all that. I personally think that was unfair nonsense.

However, I do have a problem with how she generally treats people and I have a problem with the relentless self-promotion she seems to spend much of her time on.

If it's unfair to talk about her being a CEO with a baby just because she's a woman, why isn't it unfair to talk about the uncountable number of fashion magazine covers and fashion focus she seems to have plenty of time for? (I understand of course that there's a bit of a feedback effect from the media on this, but really, just run the company and ignore the noise).

She's obviously very smart, but I worry that some of her personal interface issues may overwhelm all that. All the best business decisions in the world may still turn into a failure if you alienate your people by reading nursery rhymes to them and treating them idiot children.

gohrt3• 12 years ago

http://fortune.com/2014/11/13/googles-larry-page-the-most-am...

Larry Page does fashion magazines too. And don't pretend Fortune isn't a fashion magazine.

gyc• 12 years ago

A CEO who treats people badly and who's a relentless self-promoter? Are we talking about Marissa Mayer or Steve Jobs?

IndianAstronaut• 12 years ago

and I can't help but think it's largely because she is a woman

I would say the hate stems from her pushing a policy of ending working from home. A lot of companies followed and it really pissed off a lot of devs and ops people.

Nelson69• 12 years ago

Was it a "free fall?" Yahoo was generating $2billion a year. It wasn't "sexy" but it still has a huge amount of traffic and was bringing in cash.

It almost seemed like a trick to me, convince the world that things are really dire at Yahoo! then whoever you bring in is going to be a hero unless they are completely incompetent because things weren't that dire. They had both cash and revenue... and an f-ton of traffic and eyeballs. They definitely weren't growing at internet rates though.

I'm not saying they hadn't bought a lot of stuff that they didn't need and they didn't need to kill some products and focus but dire?

dinkumthinkum• 12 years ago

I think the people that "dig" on her would dig on a male for the same things regarding treatment of employees so I don't think that's right. It's not like any of us on HN have given Zynga a free pass.

mhomde2• 12 years ago

My bet is that Microsoft will buy them to bolster their ecosystem (second time's a charm), and Yahoo's strategy is still angling to get bought, the question is just price.

Personally I have a problem seeing much value in Yahoo except maybe Flickr and some other assets but maybe MS can use it to boost Bing or something

debacle3• 12 years ago

YHOO is going to be way more expensive now (possibly 10x the price) than the last time MSFT tried to buy them. I think it's unlikely.

Edit: maxerickson pointed out my wrongness. YHOO will be much more expensive, but the 10x number was in error.

maxerickson2• 12 years ago

Microsoft offered $44.6 billion. Current market cap of Yahoo is $45.76 billion.

The market cap doesn't necessarily capture the takeover price, but I doubt it is wrong by 10 times.

kabdib• 12 years ago

You can do a lot of R&D for $40B. A lot.

mhomde2• 12 years ago

I dunno, I get the feeling that time is running out for Yahoo and they're looking for an exit. It might be little more expensive but I don't think it'll be by that much

taksintik• 12 years ago

The market will decide. Numbers usually don't lie.

jusben13692• 12 years ago

That's so very interesting given we're talking about YHOO. The market drove YHOO's stock through the roof over the last couple of years based on nothing to do with the fundamentals of YHOO's underlying business.

new299• 12 years ago

This is pretty much the content of this article:

"Yahoo is showing progress. Revenue from the businesses Ms. Mayer created or acquired are growing at an annual rate of 80 percent, she announced in Yahoo’s last earnings update. She also said she expected overall growth to begin this year, which is pretty much in line with her original, optimistic timeline."

Someone12342• 12 years ago

What I find interesting is how big the "swing" is with articles about Mayer's strategy. You see articles essentially calling her a Steve Jobs wannabe, while others call her Yahoo!'s saviour (I place this one in that second category).

It will be interesting to see if her strategy pays off or not. It is certainly bold.

debacle3• 12 years ago

The ones calling her a Steve Jobs wannabe tend to be backed up by numbers. This article is backed up by cherry-picking third party forecasts.

That said, two years is a pretty short timeframe to turn around a 12.5k employee company. A tumblr success may be her saving grace.

josefresco3• 12 years ago

I believe this is the article being referenced: http://www.nytimes.com/2014/12/21/magazine/what-happened-whe...

ojbyrne• 12 years ago

It's interesting that the article you allude to, and this one, both reference the same book.

josefresco3• 12 years ago

Did anyone parse the earnings update to find the source of this assertion?

"Revenue from the businesses Ms. Mayer created or acquired are growing at an annual rate of 80 percent,"

Growing as in revenue or usage or both?

discardorama3• 12 years ago

That quote is from the last quarter.

josefresco3• 12 years ago

Hm, the article says "she announced in Yahoo’s last earnings update"

Still would like to know what products saw this growth...

discardorama3• 12 years ago

You have to read between the lines of the recent criticism of Mayer: she's sitting on a load of ca$h from $BABA, and their eyes are set on short-term gains. They want to butcher the company up, collect their pound of flesh and be off.

I think she's on a decent path, and by replacing the old upper management with the new hires[1], she seems to be putting the right people in charge. Yeah, she made some mistakes[2], but that's a part of the game.

[1] http://marketingland.com/yahoo-promotes-flurry-exec-lead-adv...

[2] http://www.businessinsider.com/marissa-mayer-on-henrique-de-...

exelius• 12 years ago

I think Yahoo's current path is headed toward disaster. They're obviously bulking up to be an ad tech provider in the online video space. So she's taking the $23 billion (or however much it was) from Alibaba and spending it on buying up ad tech companies.

But the problem with buying ad tech companies is that they're not a great long-term investment. Microsoft learned this the hard way with aQuantive - $6 billion in value disappeared in under 18 months. The market is just too fragmented, the services are commoditized and things can change almost literally overnight. And Yahoo doesn't really own a lot of these customer relationships the way Google and Facebook do - Yahoo is heavily dependent on partners for sourcing their data. This is not a path that leads to success for an ad tech provider; your competitors will look to disintermediate you and you have very little room for sustained competitive advantage. It's not an accident that the largest players in advertising own the portals through which consumers access content: Google for search, Google (YouTube) for online video, Facebook for mobile, Comcast for TV video.

And what's really happening is that the overall advertising market isn't really growing, we've just seen online ads take over the budgets companies used to spend on print advertising. So what happens when the next advertising trend comes along? You've got to go out and buy more startups to fill the hole; meanwhile your newly acquired companies are just taking business from your older companies, so it's not a net value add. Companies tend to engage in protective acquisitions that erode the bottom line.

Granted, I don't think Mayer has very many attractive options in front of her. But CEOs rarely want to admit that it might maximize investor returns to just hand out a large dividend and let the company fend for itself. And that's the big argument: the investors would probably be better off taking that $23 billion and investing it in companies other than Yahoo. What is the exit strategy for an ad tech company? Usually it's "get acquired by Google/Facebook". Yahoo's strategy is "become Google/Facebook", but ad tech is a zero-sum game, and Google/Facebook have sustainable competitive advantages.

jpmattia• 12 years ago

They want to butcher the company up, collect their pound of flesh and be off.

You have to read between the lines even when reading between the lines: The investors are really saying that they don't believe she would deliver decent ROI on the BABA cash.

fiatmoney• 12 years ago

"Short-term gains" isn't the goal. The goal is avoiding short-term losses for the sake of empire-building. If you look at Yahoo's market cap, net of the Alibaba & Yahoo Japan stakes, it's essentially betting that Mayer will burn a few hundreds of millions of dollars on things like non-value-adding acquisitions in an effort to remain a Major Player.

gohrt3• 12 years ago

or it's betting that the cost of current liabilities and ongoing expenses will burn that hundreds of millions of dollars more than what Mayer will recover.

It doens't necessarily mean that Mayer will generate no value, since non-BABA Yahoo had negative value even before Mayer started.

dkarapetyan• 12 years ago

Who cares? Yahoo is just another ad company clamoring for eyeballs.

Marissa Mayer’s Plan for Yahoo Takes Hold

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