Perspective: Yahoo's Jerry Yang is no Bill Gates

The New York Post, a paper whose business section has a special flair for getting the story wrong, may finally have gotten one right.

In its Friday edition, the Post writes that an independent group of Yahoo board members believes Yahoo CEO Jerry Yang may be letting emotions trump his better judgment and that's why he's opposed to accepting Microsoft's buyout offer.

When it comes to big acquisitions, so much of what gets put forward as informed analysis is likely to be off the mark. But among people familiar with his thinking, Yang's distaste for Microsoft is an open secret.

"Jerry would rather give up his left pinky than see Microsoft wind up running this company," said a former Yahoo employee who knows Yang.

I can understand Yang's reluctance to do this deal. Along with David Filo, he built Yahoo from scratch. Now an increasingly noisy chorus of shareholders is pressuring him to turn over the keys to the "Monkey Boy" and his cohorts. That has Yahoo scrambling to come up with alternatives. One day Google pops up as the leak du jour, the next day it's News Corp. At this rate, it won't be long before we hear rumors of Warren Buffett sightings.

Would one of those scenarios result in a better denouement? The answer depends on who you're asking.

When I talk with folks who consider themselves in the "pro-Jerry" crowd, I hear Yang described in almost worshipful tones. His people trust him to do the right thing. They love him for his passion and commitment. And even though Yang could have checked out years ago, he earned their loyalty by sticking with it through the good years and the lean. And so it was that when Terry Semel got sent back to La-La Land, Yang agreed to a return engagement as Yahoo's CEO.

Yahoo shareholders can't be equally impressed. Fact is that Yang was involved in horrendous decisions where Yahoo wasted billions on rancid acquisitions. What's more, the extensive turnover in the executive offices--Semel, Tim Koogle, Jeff Mallett, Dan Rosensweig, and Wenda Harris Millard, among others--doesn't inspire confidence that this company knows what it wants to be when it's all grown up.

Corporate turnover in tech-land is a fact of life. I could easily come up with a similar list of top Microsoft executives who subsequently were shown the exits. The big difference being that during the interregnum Microsoft became one of the most successful corporations in the history of American business. A lot of the credit for that goes to Bill Gates. When you tally the last three decades of the technology business, how many co-founders navigated their companies as successfully through so many twists and turns?

I don't want to draw invidious comparisons, but there's little in Yang's track record to suggest he's got the makings of a superstar CEO who could lead Yahoo's revival--especially not at this juncture.

Earlier this month, Millard, who ran sales at Yahoo, used the occasion of an appearance at a media summit to speak frankly about her former employer. She did not mince words.

"Yahoo lost sight of who they are and who their customers are," she said. "Yahoo's perception is that their only competitor is Google. But 95 percent of their revenue comes from advertising--so their competitors are really the broadcast TV networks. They think they're in the search game, when they should really be in the brand advertising game."

"It reduces choice for advertisers," she added. "There would be two Goliaths, down from three. Advertising is a business that is both art and science. The merger focuses unduly on science. With Google-DoubleClick and Yahoo-Microsoft, it is as if the scientific community is taking over advertising. And advertising is not about science."

Who can argue the point? And while Yang may not have been CEO while Yahoo made many of those decisions, he went along for the ride. And that's why the loyalists who "want to give Jerry one more chance" are living in the past. I know Bill Gates. I cover Bill Gates. And Jerry Yang, sad to say, is no Bill Gates.

Biography
Charles Cooper is CNET News.com's executive editor of commentary.

More Perspectives

[john55440]

"Yang may be letting emotions"

"...Yahoo CEO Jerry Yang may be letting emotions trump his better judgment..."

It sure looks that way.

[WJeansonne]

Yahoo Died the Day Google was Born

Brilliant analysis, Cooper! I couldn't have said it better. Yang is indeed no Bill Gates and never will be. Yang, like so many geeks was a pioneer, we can give him that much credit. But as we all know it's rare when the pioneers of the industry outlast the innovators, which Google was and is in every way. Yang didn't know what hit him and his organization once Google took hold. And the rest is history. So give it up Yang!

[Penguinisto]

I agree.

I for one cannot wait for Microsoft to get mired in debt, wind up not gaining much, if anything from the acquisition, and get saddled with a site whose customer base will flee in droves. ;)

Meanwhile they can continue to happily ignore their own core products, as they have done with Vista.

/P

[EmbSysPro]

So What?

Mr. Yang is running a multibillion dollar company that he founded, of course he?s emotional, he has every right to be.

He is not running his company into the ground. But there obviously has been some sleeping at the wheel.

Yes, they are not the titans of the search business but still Yahoo has an exceptional brand and is embarking on some very interesting new endeavors.

The new frontier for Yahoo is a back to basics web portal fundamental but with a new Social Networking attitude.

Social Networking and Social Networking Devices are the next wave, witness LiMO, Android, OpenMako, mobile Firefox, Opera Mobile, the sale of Trolltech, etc. and Yahoo is positioned very well to capitalize and compete on this.

[stuxstu]

Jerry does not own Yahoo

Jerry is nothing more than a stockholder. He is not the "owner" of Yahoo. He owns shares... I own shares too.

I have watched Yahoo slip in its stock value and as an inverstor, Jerry owes it to me and the other investors to provide value to our stock.

Sell to Microsoft, combine and move forward as a competitor to Google.

I would very much enjoy watching my Google and Microsoft stock rise...

[theloniousMac]

Bill Gates is no Bill Gates

"...The big difference being that during the interregnum
Microsoft became one of the most successful corporations in
the history of American business. A lot of the credit for that
goes to Bill Gates. ..."

Couple things here. First of all people give Bill Gates and
Microsoft way too much credit for the wealth that was brought
to them by one lucky decision on Gates' part and one horribly
bad decision on IBM's part. Microsoft is the world's greatest
industrial accident. It wasn't planned. Since then the company
has rested on the glorious success of DOS and largely achieved
lasting mediocrity in every other respect. And if you want to talk
about bad acquisitions... well, Microsoft has had its share.

The only possible way for Microsoft to make anything succeed is
if they can somehow latch it onto Windows and basically force
people to buy it when they buy Windows. Microsoft will never be
a big player in the Web space because they just don't have the
"cool" necessary. Maybe if they toss out Balmer and the rest of
the upper management dead weight the pilot light might come
on again.

As far as MS buying Yahoo, I can't think of another time when
the thought of billions of dollars passing hands generated such
a yawn. Who cares? Yahoo has slipped into mediocrity and MS is
just re-arranging the deck chairs on the titanic. Whatever
coolness Yahoo has left will fade if Microsoft buys it.

[dfarber]

Only one Bill Gates

I don't disagree that Jerry Yang is no Bill Gates, but neither is Eric Schmidt or whoever. What's clear is that it's too little too late for Yahoo...and big changes are in order, whether Microsoft, News Corp or xxxxxx.

[normavctam]

This is Journalism?

Not sure I'd call this content-free slam on Jerry Yang journalism. Somebody at C|Net probably owns a lot of Yahoo stock, and like others is only concerned with their own short-term profit.

Mod-down cnet for journalistic integrity.

[amarkj]

This is an EDITORIAL!

This is called an EDITORIAL!

[JCPayne]

Read the facts. Microhoo would still trail google.

Not to mention all of the Yahoo die hards that will defect when Microsoft took over living it even worst off.... Microsoft can't even MSN a player in the industry so how are they supposedly going to make Yahoo better???

Yahoo + Microsoft would be just like another failed AOL/Time Warner or AT&T/MediaOne/TCI merger all over again...

[JCPayne]

Read the facts. Microhoo would still trail google.

Not to mention all of the Yahoo die hards that will defect when Microsoft took over leaving the combined company even worst off.... Microsoft can't even make MSN a player in the industry, so how are they supposedly going to make Yahoo better???

Yahoo + Microsoft would be just like another failed AOL/Time Warner or AT&T/MediaOne/TCI merger all over again...

[manaboulsi]

Yes, He is smarter :-)

If Yahoo was a nothing AND/OR in trouble AND/OR Bill was smarter then Jerry, Bill wouldn't be caughing up money.

Let's face it. Microsoft copied "some would say stole" everybody ( Including Yahoo), and if that was enough they wouldn't be shelling out money AND Going to debt just because they "respect" Yahoo.

I love this.

[rk2469]

this is a commentary

that's why this is called "Perspective"
learn to read and understand.

[Manhattan2]

Yahoo and Mr. Yang need to go after Sensible Ventures

If Mr. Yang wants to compete in location based adverting and continue to come out with ground breaking solutions he needs to visit SensibleVentures.com . That may be what he needs to get back on track and not only compete against Google but to outright win the technology wars.

[petermpham2003]

No one is Bill Gates but Bill Gates himself.

Years ago when Eric Smidth took over Google. Charles wrote an editorial saying what kind of hope Google could have to hire a CEO who once defeated by Microsoft. Now, it turns out Microsoft gets their xxx burning.

At that time, I wrote a comment to point out that it is the team and the corporate culture
that makes the different, not an individual
and this time, Eric may have the right team.

Now, giving time and the right team, Jerry can do the same as Eric did. So did Bill.

[brundlefly76]

Naiive interpretation from an outsider

Jerry Yang has forgotten more about the internet business then most internet CEOs will ever know, as well as having having pretty much invented internet search with David Filo, rather then just one-upping the algorithm like Google did. Most people also forget that Yahoo! was a fundamental asset to Google during its infancy.

Early in Yahoo!'s growth, Yang knew quite well that he was not suited to be CEO - or even President - which is why Koogle and Mallett came in.

However, Yang has been on the frontlines for about 15 years now, so his experience is quite frankly unsurpassed in the industry for leading Yahoo!

At the same time, a fresh perspective is often what is needed - but how far did that get Terry Semel far.

As we all know, any given CEO can or cannot turn around any given company at any given time - there are far more factors involved. The only way to know is to roll the dice.

Is Yang the right person to lead Yahoo! now? I don't think anyone knows, but I do know he is perfectly qualified and at least one outside superstar ceo has failed miserably at the same helm.