Yahoo’s Personality

The Economist discusses Yahoo’s “personality crisis”:

As if to prove the smorgasbord theory, Yahoo! this week finalised a $1 billion deal with, a Chinese firm, that will give Yahoo! greater exposure to the promising, fashionable Chinese market, but may make Yahoo!’s product portfolio even less coherent. Yahoo! is primarily a consumer site, with everything from web search and web mail to news, music, photos, games and live chats. Alibaba has been mainly a business-to-business site that hooks up Chinese wholesalers and foreign retailers. This fits a pattern. Terry Semel, Yahoo!’s chief executive since 2001, has done a notable job turning Yahoo! around since the losses of the dotcom bust, says Jerry Michalski, a technology visionary in Berkeley, but in the process he has turned it into, well, a bit of a tart.

Yahoo!, of course, would disagree. The only place anyone needs to go to find anything, communicate with anyone, or buy anything, is how the firm describes itself, adding that it has a web audience of over 345m users in 25 countries. This appears to be paying off handsomely. Last month, Yahoo! reported quarterly revenues up by 51%, and profits up by 70%, compared with the same period last year (excluding the spectacular profits that Yahoo! made by selling shares it owned in its rival, Google). Internet advertising is growing fast, but Yahoo! is growing even faster, said Mr Semel.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.