Yahoo! Inc Strategy

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As one of the leading pioneers of internet Yahoo! was founded in 1994 on board a trailer on Stanford’s University’s campus by Jerry Yang and David Filo. Yahoo’s core came from display and search advertising such as billboards on top of homepages. However the company faced losses due to poor management decisions which in turn angered the shareholders. By 2010 Yahoo’s revenues estimated roughly $6.3 billion which of 84% came from advertisement and the remaining from subscription fees for photo services and real estate. Yahoo’s motivation came from having a unique product and was not a means to a larger business model. As internet grew bigger and more companies entered the market the rivalry stared to worry the decision makers in Yahoo.…show more content…
However analyzers saw this as an aggressive macroeconomic strategy while Google continued its dominance over Yahoo! In 2009 Carol Bartz was appointed as the new CEO for Yahoo! She was known to cut costs and reform the company to create value for shareholders and gaining possibility for customers, partners and employees of the company. However it did not take long before she was criticized for her relations with Alibaba. The Chinese business to business selling forum’s subsidiary Alipay was an online payment site which was sold to a private company making it out of reach for Yahoo! Investors became angry and blamed Bartz for its cold relationship with the Alibaba group. Her ten year agreement with Microsoft led to boost the panama project ranking Yahoo! as the number three search engine. The leadership hoped that her strategy of a $200 million budget cut would help the company to focus more on selling banner ads for its owned media and email pages. However that was not enough as investors blamed the mistakes on the board and their way of handling business, selecting four CEO’s in four years, as the deal with Microsoft should have taken place in 2008. In a letter Daniel Loeb CEO of Third Point LLC with a 5.1% stake wrote his complaint and demanded to fire Carol Bartz and the board in order to restore order in the organization. Porter’s five forces analysis 1. Threat of new competition: * Yahoo’s biggest threat

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