Her tenure was largely a disappointing one, though she doesn’t get enough credit for straightening out Yahoo’s finances, overhauling some of its backend systems, and getting out of a lot of businesses Yahoo shouldn’t have been in. What she should have done, and failed to do, as all her predecessors have, is articulate a vision for what Yahoo must be.
This will be the task of whoever the next Yahoo CEO is: a) articulate a strong, compelling vision for the company and b) execute on it. Both aspects are crucial.
What should that vision be?
Yahoo needs to own the fact that it’s a media and content company.
Based in Silicon Valley and full of Google envy, Yahoo has always tried to be a technology and platforms company. Whether or not that was a good idea ten years ago, that ship has now sailed. The enemy isn’t even Google anymore (and Yahoo was wise to get out of search), it’s Facebook.
Technology is now a part of media, especially online: witness the Huffington Post’s industry-leading CMS and SEO which are as much a part of the company’s success as Arianna Huffington’s talent. But it’s not the only thing. Yahoo needs to keep doing amazing technology, but it needs to pair it with amazing content.
If that sounds a lot like AOL’s strategy, that’s no coincidence. Tim Armstrong actually articulated a very good vision for what a portal business in the post-Facebook era should be. Armstrong has thus far mostly failed to articulate on that strategy, but it’s the right one.
- Yahoo’s problem is that its brand doesn’t stand for anything anymore. As our friend Dan Frommer writes, Yahoo was once a very cool brand–and it seems shocking now. People visit Yahoo.com every day, but they don’t love it. Yahoo needs to give people a reason to, and that means creating original content.
- Content is getting unbundled. The web is the great unbundling machine. This is true of newspapers, but it will also be true of portals at some point. When people want “their world” in their browser homepage, that’s Facebook, not Yahoo. And even the concept of a browser homepage is going away. That means that instead of fantasizing about being a platform like Facebook and Google, Yahoo should instead try to be the number one property on these already existing platforms (and mobile, too).
- At the end of the day, there is a secular shift of ad dollars from offline to online which is still going to happen. That’s the pot of gold Yahoo should be going after. Being the web’s top original media property should help with that.
Who should be the CEO to lead that charge? In all likelihood, not someone from the traditional media world. Yahoo needs to become a media company, but the rules of old media often don’t work online. What Yahoo needs is a very strong online product person, who will translate the media vision into products people love, and who can work very hard to motivate and attract the best people at Yahoo by articulating a compelling vision of Yahoo’s future.
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