With Yang out, big changes coming to Yahoo?
New CEO Scott Thompson gets more room to maneuver with departure of active co-founder, analysts say
Computerworld - Yahoo co-founder Jerry Yang's departure this week from the company should put in in a better position to take drastic action to fix its long-running woes.
Yang has seen the company become one of the first Internet high flyers and then descend into B-level status since founding it 18 years ago next month. He resigned Tuesday from multiple positions at the firm, including his lofty position on the company's board of directors.
Yang's departure is but the latest upheaval at the embattled company that in September ousted former CEO Carol Bartz, and then dealt with speculation that both Microsoft and Google may be gunning to buy Yahoo.
Just two weeks ago, Yahoo appointed former PayPal president Scott Thompson to replace Bartz as CEO.
Now Yang, who helped to found the company while at Stanford University in 1994, is gone.
"I'm not really surprised that Yang is out," said Dan Olds, an analyst at Gabriel Consulting Group. "The company has been floundering for years and now it looks like there's a good chance his baby is going to be dismembered. I can't see any founder who would want to hang around for that."
It's not clear whether the choice to leave was Yang's.
Analysts speculated that he could have voluntary left rather than wait for the company to be chopped up and sold or because he wanted to make it easier for Thompson to lead the company. Of course, Yang also could have been pressured to leave the firm, they noted.
After Yahoo rebuffed a strong Microsoft effort to acquire the company in 2008, many observers said that Yang vehemently led the opposition even though it would have netted shareholders significant monies -- far more than could be garnered in a sale today.
Because of that, analysts are now speculating that Yang may have been pushed out so he wouldn't be around to block the board from accepting any acquisition offer.
"With Jerry out of the room, it becomes easier for the board and management to discuss big moves -- like splitting up the company or even dissolving it -- that would be more difficult to approach with Yang at the table," said Olds.
"I think the board and Thompson are probably relieved to see Yang leave. It's always a sticky situation to try to make big, transformative moves when founders are still involved in managing the company," he added.
Rob Enderle, an analyst with the Enderle Group, noted that Yang resignation from Yahoo Japan as well could indicate that the company is looking to sell either part or all of its Japanese division.
"I think Thompson realized that to do his job effectively he needed to get Yang out of his way," added Enderle. "His easiest and most profitable path near term is to sell the company. This makes that option more viable."
Patrick Moorhead, an analyst with Moor Insights & Strategy, noted that by getting rid of a co-founder, Yahoo could try to start fresh with a new CEO and a founder-free board.
"This is a classic case of a founder getting tagged with the issues of a company in distress and a view by those in power that he's not part of the solution," he added. "Sometimes to recreate and reinvigorate a company, as the investors are asking, they need to demonstrate physical change, or an iconic figure leaving the company."
With Yang out, Thompson has more autonomy to lead the board through his preferred path.
"Getting rid of a strong redundant leader is always a good first step for a new CEO," said Enderle. "This would indicate a strong start."
Sharon Gaudin covers the Internet and Web 2.0, emerging technologies, and desktop and laptop chips for Computerworld. Follow Sharon on Twitter at @sgaudin, or subscribe to Sharon's RSS feed . Her e-mail address is firstname.lastname@example.org.
- How a private Dell works with customers, and sees its rivals
- Update: SanDisk agrees to pay $1.1 billion flash storage maker Fusion-io
- CompTIA now offers its research without charge
- Microsoft's new CEO and his first-100-days plan
- Personal history may thrust new Microsoft CEO into visa debate
- As Dell cuts, Apple adds jobs in Austin
- Dell cuts 'small percentage' of workforce
- Lenovo's Motorola, IBM server buys will likely get strict U.S. security review
- Welcome to the era of radical innovation
- China passes Japan to become world's 2nd largest IT market
Read more about Internet in Computerworld's Internet Topic Center.
- Capabilities You Need in an IP Address Management Solution A mismanaged IP space can cripple an otherwise healthy network. Take a moment to understand what you need in an enterprise-ready IPAM solution.
- IPv6 Fundamentals IPv6 is needed to sustain the growth of the Internet. The transition from IPv4 will require planning and likely some degree of support...
- 3G/4G Digital Signage Guide Today, the widespread availability of 3G and 4G cellular or wireless broadband networks enables digital signage to be deployed virtually anywhere.
- Enterprises in Motion: In-Vehicle Networks In a world where traditional tethers to the central office have all but vanished, enterprises that operate vehicle fleets require constant and dependable...
- Tips to Simplify Database Administration and Development Make your job easier while getting the most from the leading productivity tool for database professionals. Learn tips from Dell Software's Oracle® ACE,...
- E-Signature RFP Checklist Webcast If your organization is looking to adopt e-signatures, you may be overwhelmed by the number of providers that offer seemingly similar solutions. How... All Internet White Papers | Webcasts
Our new bimonthly Internet of Things newsletter helps you keep pace with the rapidly evolving technologies, trends and developments related to the IoT. Subscribe now and stay up to date!