Mayer could pull off 'epic turnaround' at Yahoo

What the ex-Google exec must do in her first days as CEO

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By any measurement, it will be a big, messy job.

Last September, Yahoo pushed out then-CEO Carol Bartz. In January, the company hired Scott Thompson, president of eBay's PayPal division, as its CEO. Five months later, Thompson was out amid a public scandal surrounding the inaccurate reporting of his academic credentials. For the second time in eight months, the company was not only in an embarrassing spot, but was without a CEO.

If those were the only issues that Mayer had to deal with, she would be facing a big challenge. But Yahoo has had its share of business troubles, as well.

The company started out as an Internet pioneer but slowly slid into insignificance. Yahoo has lost user mindshare over the years, as one upstart after another -- from Google to Facebook and Twitter -- has come along and pushed the company into the background.

Tuesday afternoon, Yahoo reported revenue of $1.2 billion for the second quarter of 2012, essentially flat compared to the same quarter a year ago. Income for the period was $190 million, down $1 million from the same quarter of 2011.

"It's a bit of a train wreck," said Enderle. "But this could be an epic turnaround. Mayer is more qualified to run Google than [Google CEO Larry] Page is. She has better people skills and has the rounding needed by a CEO. You basically have the person who should be running Google running Yahoo. Pretty much anything can happen."

Over the course of the past eight months, there have been various reports saying that either Microsoft or Google was trying to buy Yahoo. Some analysts thought selling would be a great option for the struggling company.

But now with Mayer at the helm, analysts say that option is likely off the table.

"I think bringing her in makes it obvious that selling the company isn't what the board has in mind," Olds said. "And I don't think she would have signed up for the job if it entailed taking Yahoo to the chop shop and selling off the parts. I think the only way they could land her was with a challenge that she couldn't get anywhere else -- a place where she can prove herself, apart from Google and the vast success she's experienced there."

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 on Google+, or subscribe to Sharon's RSS feed . Her email address is

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Copyright © 2012 IDG Communications, Inc.

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