Dear Ross Levinsohn,
Congratulations on being named Yahoo's new interim CEO. We all wish it had come under better circumstances, but now it's your job to stabilize Yahoo and turn the company around. You have a difficult road ahead, but I hope you have better luck than your predecessors.
I know you have a lot of work to do in order to clean up the mess Yahoo is in. There is no way the company can recover, though, if you don't deal with the albatross around Yahoo's neck. I propose that you make one of your first acts as CEO to end Yahoo's patent lawsuit against Facebook as quickly as possible.
In March, Scott Thompson, your predecessor, decided to sue Facebook for patent infringement on the eve of its monster IPO. It's not a new strategy -- Yahoo did the same thing to Google before its 2004 IPO and made millions. It was logical to conclude that Yahoo could achieve a similar result with Facebook.
However, the lawsuit turned Thompson into one of the most hated executives in Silicon Valley. The move was seen as a way to stifle innovation, and Silicon Valley's elite quickly turned him into a villain. Without any support in the broader tech community, there was really no way he could survive his resume controversy.
Your predecessor also underestimated Facebook's willingness to fight back. The social network quickly acquired more than a thousand patents to use as nuclear deterrents. Facebook isn't going down without a fight. It's a fight that will only damage Yahoo's reputation further.
Will Yahoo eventually prevail if it keeps pushing on the Facebook lawsuit? Most likely -- but at what cost? Company morale is in the gutter, and Yahoo is no longer focusing on the fundamental issues that threaten to destroy the company. Winning the Facebook lawsuit will not turn the company around.
So how does Yahoo stop losing key employees, rally the troops, regain lost allies and start fixing its fundamental issues? Simple: it needs to find a way to end the Facebook lawsuit quickly. You, Mr. Levinsohn, need to find a way to end the madness your predecessor set into motion.
I don't care how you do it. I don't care if you negotiate a settlement with Facebook or just drop the lawsuit entirely. The only thing that matters now is ending the lawsuit as quickly and quietly as possible. Until that lawsuit is resolved, Yahoo will not be able to move on.
Many people within Yahoo will disagree with the decision to end the Facebook lawsuit now. However, Yahoo needs bold leadership more than ever if it is to survive. Dropping the lawsuit won't instantly fix Yahoo's problem, but it will help stop things from getting worse.
How would dropping the lawsuit help? The technology press, which has been heavily critical of Yahoo's lawsuit against Facebook, would ease up on Yahoo, giving it room to breath. Yahoo's relationships in Silicon Valley would become less strained, opening up the door to more beneficial partnerships. And employee retention, which has become a major issue for Yahoo in recent weeks, would improve (there's a reason why Yammer's CEO recently offered $25k bounties for Yahoo engineers.)
At the very least, Yahoos would again feel like they work for a technology company, not a patent troll. Being proud of the company you work for matters.
Dropping the Yahoo lawsuit can only help the company move on from your predecessor's mistakes. It's up to you, Mr. Levinsohn, to end the Facebook patent lawsuit in order to save Yahoo from annihilation. Please make it one of your first acts as CEO.