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| NEWSMAKER: JERRY YANG | |
| Thanks a lot, say shareholders | | Leslie D`Monte / New Delhi November 21, 2008, 0:45 IST | |
It’s a move that Yahoo! shareholders like Carl Icahn ardently desired. “In my opinion, you might have to get rid of Jerry and part of the board to bring back Microsoft...,” was what Icahn told New York Times after Yahoo! CEO Jerry Yang turned down Microsoft’s 2008 buyout offer of $33 a share. The internet player’s stock price has dropped to less than half since then.
Google, too, decided not to proceed with commercial search advertising arrangements fearing that the concerns voiced by the US authorities would result in litigations and hamper its market growth.
It hardly comes as a surprise, then, when Yang declared he will step down as CEO of Yahoo!, its ailing stock soared nearly 9 per cent to close at $11.55 on the Nasdaq, a day after the announcement. Of course, the Yahoo! chief — who took the job as CEO in June 2007 to unsuccessfully attempt to spur it to glory again — said he’ll stay on as CEO till a replacement is found (expected in Q1 next year).
The company — founded three years before Google — is now way behind the internet search giant. While studying electrical engineering at Stanford University, Yang co-created (in April 1994 with David Filo) an internet website comprising a directory of other websites called “Jerry’s Guide to the World Wide Web”. It was renamed “Yahoo!” (an exclamation), and became very popular.
Yang and Filo realised the business potential and co-founded Yahoo! Inc. in April 1995. However, the success story was shortlived. Yahoo!, for instance, inadvertently propagated Google by using the latter’s search engine and making it a household name and dictionary term. Besides, Yang’s preference for letting employees reach a consensus rather than make tough decisions himself is said to have backfired on many occasions.
Yang’s woes, incidentally, have not been restricted to the stock markets. He was criticised for a statement regarding the role of Yahoo! in the arrest of mainland Chinese journalist Shi Tao by Chinese authorities. While in China, Tao used a Yahoo! email address to notify a pro-democracy website that the Chinese government ordered the Chinese media not to cover the 15th anniversary of the Tiananmen Square Protests of 1989 on June 4.
Yang’s defence was that to do business in China, one would have to comply with local laws. He was ummoned to Washington to answer for Yahoo!’s comments regarding its role in the arrests of Tao and other journalists in China. In November 2007, Yahoo! agreed to settle with affected Chinese dissidents, paying them undisclosed compensation.
The Yahoo! Board, reports the Wall Street Journal, is now said to be looking for an “anti-Jerry” to turn things around — executives who are not mere thinkers but have strong operational skills who may be veterans of the high-tech and media worlds.Tim Armstrong, a senior vice-president at Google, and Peter Chernin, president of News Corporation are reportedly being considered at this stage though there was no confirmation.
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