[adventureful]

Apple is a once in a century example, good luck with that.

And besides, I didn't suggest nothing can be changed at Yahoo. I didn't say that at all.

I said it should be blown apart, and the stagnant 1990s products should go. Mayer should put her talents to work on a smaller core where growth can be achieved with new products.

Yahoo Finance? Yahoo Sports? Search? Yahoo Mail? 1998 era portals? There's no growth there. She might be able to revitalize energy into Flickr and adjust it to a smart phone world, that'd be one existing major product worth giving some attention to (for example).

Unless Mayer has something equivalent to the game changing PageRank approach to search, there's absolutely nothing she can do to improve Yahoo's search product. So what can she do with the existing product core exactly? Not much, stagnation is inherent to most of the product segments in question.

The real simple angle is: ok, what's the gorilla / whirlwind product that's going to revitalize Yahoo? Search? Not a chance. The content niche products like sports or finance? Nope. Web mail? Comeon. Classifieds & jobs? Nope, small potatoes. So what is it? To really grow a $20 billion company, you need to find billions in new profit. Mayer will only find that with new products. Unless you think she can take 1/4 of the search market back from Google or take a huge chunk of the rest of the web email market.

Yahoo needs a blue ocean change.

All the stagnant parts should be sold off for a huge amount of cash. And she should more or less start over and attack something new where Yahoo can own its segment and build a gorilla product with huge growth potential (instead of being 2nd or 3rd (etc) place in everything).

[wonderyak]

They've only stayed somewhat relevant the past decade due to partnerships and these legacy sorts of services. I agree 100% with this. But what are they to do? They aren't Amazon. Try and buy Netflix and battle it out with all the other digital entertainment services?

[adventureful]

They're going to have to literally reinvent themselves. Not in the B.S. wishy-washy way they've proclaimed numerous times. But in the balls out risky reinvention where if you fail, the company potentially gets sold for peanuts. They're not going to get anywhere playing it safe at this point.

The smart phone market is still relatively wide open for new, not-yet-thought-of services. Yahoo could throw their focus strongly that direction and try to matter there, betting on the future.

Buying Netflix wouldn't be a terrible idea, they're cheap these days relatively speaking. They could bring a lot of cash to bear behind Netflix, which could be put to use beefing up their streaming selection.

There are a few potential acquisitions they could do to get pointed in the right direction in terms of products relevant to the future. Yelp and Foursquare for example. They need to be able to properly handle services they acquire however, and perhaps Mayer can do a better job of that than their previous leadership. They'd need to do something more like what Google did with YouTube.

Short of making a dramatic change, it's merely a game of milking old assets for cash and slowly fading away.

[wonderyak]

There was a time, not that long ago, where Yahoo! was in a bad situation. Their search engine was terrible, portals were dying and they were losing mindshare like you read about. The thing is, at the same time they were doing REALLY interesting R&D work (Yahoo! Pipes, YUI, etc).

The impression I get is that in the last few years between the cuts, layoffs and good people just leaving they have virtually no talent left to resussitate the company.

Am I wrong in thinking this? Where is all of this awesome new stuff going to come from?

[cpeterso]

In a day when Instagram can be acquired for $1B, how much would Yahoo have to pay for Netflix? NFLX market cap is about $4.6B with $3B in assets.

[wonderyak]

Well that would certainly cover the 'risk everything to turn it around' idea posited above. I don't think anyone thinks FB didn't overpay for Instagram, it seemed like a desperate move, but then again they were flush with cash and it might be a great value compared to building their own.