Yahoo! Versus Google - Does Yahoo! Stand a Chance at Winning?


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One of the last desperate gasps of corporate manuvering that ex-CEO of Yahoo! Terry Semel did, was to offer a full quarter of Yahoo! stock to News exchange for the ownership of that News Corp. had forked out over $580 million for two years ago. Needless to say, that lame duck deal never saw the light of day, as Semel has since left Yahoo! for greener pastures in the internet world, leaving the far superior-thinking Jerry Yang at the helm of Yahoo! for the immediate future.

Semel's horrible management of Yahoo! over the past five years was a combination of misinformed business decisions concerning the future of the internet itself, and the lack of Semel's ability to cut through the corporate bureaucracy that has allowed Google to leap past Yahoo! to become the #1 search engine that it currently is today. Everyone in Silicon valley realized that Semel had to leave Yahoo! if the company ever wanted to gain back the ground that Semel had lost to Google over his disastrous reign for the past few years, so Semel's resignation came as no real shock to anyone.

Major tech companies always need their CEO's to be people who have a strong background in technical issues, and Yang is certainly no exception. As one of the major founders of Yahoo! since its inception, Yang should be able to come up with a new company strategy that will put on emphasis on attaining new technological advantages over Google that will allow Yahoo! to step up the competition.

A lot of key personnel in Yahoo's ranks had left the company because they hated the fact that Semel was not an internet guy at all, and he had no real interest in running Yahoo's day-to-day business. He was seen as a figurehead for a once cutting-edge tech company that had lost any focus on what it takes to keep up with a behemoth like Google has turned into.

The performance gap between Yahoo! and Google really needs to be closed very quickly if Yang is to succeed at his new job, and a huge buy-out from another tech company might just have to take place for that gap to be closed. Microsoft and Comcast both have been rumored to be seeking out exactly how much Yahoo! would be worth to them, while other insiders believe that Yahoo! fares a better chance at financial gains if they just align themselves with Google and outsource their search engine to Google for a huge cut of the ad revenue that would be generated on Google's much more popular pages.

Google's main searches bring back 40 percent more ad revenue than Yahoo! does, and the February release of “Panama", the new Yahoo! ad system that was supposed to generate a more streamlined approach to help increase Yahoo's advertising revenue did absolutely nothing for them. Yahoo's banner advertising which was once their pride and joy could drop their second-quarter results far below the midpoint of the predictions that Yahoo! had forcasted only a few months ago.

Yahoo! even had a chance to buy the extremely popular social bookmarking site Facebook, at a price of $1 billion last year, but did not complete the deal because of Terry Semel having to re-think the deal. Now, with Facebook's overwhelming new popularity, that decision could potentially cost Yahoo! millions of dollars in lost revenue over the next five years.

Nobody wants to see Google take over the entire search engine ad revenue market all by themselves. Yahoo! should look at every possible strategy so they can somehow come up out on top, and get out of their own way so that true success will come back to their search engine business which will allow them to give Google the much needed competition they need so that this search engine monopoly can finally end.


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