Yahoo CEO Jerry Yang To Step Down

JagsLive was one of several readers to point out Jerry Yang's departure as Yahoo CEO. He's not leaving the company; he will return to his former role as Chief Yahoo, whatever that entails. Yang has been under fire in recent months from investors for his handling of Microsoft's recent acquisition attempt."Yahoo, under fierce financial pressure, has begun a search to replace company co-founder Jerry Yang as chief executive, the company said Monday. 'Jerry and the board have had an ongoing dialogue about succession timing, and we all agree that now is the right time to make the transition to a new CEO who can take the company to the next level,' Chairman Roy Bostock said in a statement."

Comments

Isn't it kind of sad

[Armakuni]

when a company's main goal is to be acquired as soon as possible?

Re:Isn't it kind of sad

[Anonymous Coward]

Exactly. This is capitalism at work. In Communist Canada, company sells you.

Re:Isn't it kind of sad

[QuantumG]

Well, in the case of Yahoo, sure, they've already gone public. But for startups? Getting acquired is the dream. You don't have to deal with those bastard accountants, and everyone gets a payout.

Re:Isn't it kind of sad

[NoobixCube]

We can only hope Brainsuck Industries will synergize with them.

Re:Isn't it kind of sad

[bakuun]

A company's main goal, seen from the shareholders point of view (that ultimately of course control the company) is to make money.

Microsoft offered $33 per share - the yahoo share is now around $10.

If I was a shareholder I'd be pissed as well.

Re:Isn't it kind of sad

[Antique Geekmeister]

It's the dream for the investors. Employees who don't live near the new corporate offices, or who liked actually getting anything done, or the latest who weren't there long enough to have received options, often wind up really hurt by such corporate purchases.

Re:Isn't it kind of sad

[QuantumG]

Yes, it's a dream for the shareholders. Ya know, the people the company exists to serve?

Re:Isn't it kind of sad

[Antique Geekmeister]

Different shareholders have different dreams. And shareholders are hardly the only investors in a company: those who work there have legal rights as well, and may be served better by different corporate strategies. Being purchased by Microsoft, for example, has been the death knell of many companies with valuable products or even profitable businesses.

Re:Isn't it kind of sad

[Martin Soto]

Nope, companies are there for offering goods and services, which means, they should concentrate on serving their customers, not their shareholders. If capitalist principles hold at all, a company that serves its customers well should of course make money, which, in turn, should result in higher returns for the shareholders.

Saying that companies are there only to serve their shareholders, that is, only to make profits, is just a justification for all sorts of dirty business practices. If all you have to do is increasing profits, it is then perfectly OK to release dangerous products, abuse your employees as much as possible under applicable legislation (and then maybe a bit more), harm the environment with your production methods, or risk people's life savings in absurd investment schemas, among many other horrors of modern life.

Re:Isn't it kind of sad

[bberens]

Seriously, the company you work for does not exist to enrich your life. It exists to enrich the life of the owner(s). You are paid a stipend to perform labor because the owner(s) believe that your work will further enrich them.

Re:Isn't it kind of sad

[Paradise Pete]

Microsoft offered $33 per share - the yahoo share is now around $10. If I was a shareholder I'd be pissed as well.

The open market price at that time was $30. Anybody who didn't take some off the table then gets no sympathy. If not they were taking a huge risk in order to squeeze out another $3. When the upside is effectively capped like that, then without specific knowledge is foolhardy to risk everything for that relatively small return.

Re:Isn't it kind of sad

[TheRaven64]

But for startups? Getting acquired is the dream

I'd have thought that being sufficiently profitable to buy back all of the VC-owned shares and give a large regular dividend to the founders would be the dream, selling the company would be second-best.

Re:Isn't it kind of sad

[DustCollector]

>>Yes, it's a dream for the shareholders. Ya know, the people the company exists to serve?

A more enlightened company exists to serve its *customers*. Customrs are best served by capable and satisfied employees. Shareholders would benefit as a side-effect.

Too often, "we do this for the sake of the shareholders" line is an excuse for doing something unsavory, immoral, or borderline illegal.

Re:Isn't it kind of sad

[timeOday]

To me it is clear that a company does not exist for one single reason, since most can't exist without customers, employers, and investors; therefore the purposes of the company are to satisfy customers, pay employees, and enrich investors. Of those three, I'd say investors are the least necessary, since a company could grow (however slowly) without borrowing. Bartering certainly predates credit and supported economic development to a certain point.

Re:Isn't it kind of sad

[tftp]

Saying that companies are there only to serve their shareholders, that is, only to make profits, is just a justification for all sorts of dirty business practices.

You may not like it, but that's how the world operates. People who invest their money (investors / shareholders) are the primary focus of the company. Customers really exist only to help the company to make money. Anything that is not illegal is allowed and is expected to be done if it furthers the goal of making more money. In fact, if the business managers do not do what is expected to make more money ("fiduciary duty") then they can be sued and/or replaced by investors.

Re:Isn't it kind of sad

[uberotto]

You seem to be missing a fundamental shift that has occurred in the U.S. and around the world over the last 30 years. You are right, the customer is king and that any companies primary goal should be to serve their customers. And in the case of Yahoo, as well as most other large American corporations that's exactly what they are doing...

What you are missing is the shift that has occurred as to who exactly the customer is. Now days, for most large corporations the customer is the stock holder. We, the consumers are the product that is being sold. With Yahoo, Google, MSN etc. it's about how many eyeballs they have looking at their pages. For companies such as Ford, GM, Target, WalMart it's all about the size of their consumer base. That's why Ford and GM don't spend a lot of time building cars that tomorrows consumers might want. Their only focus is to build as many of whatever cars the consumer is buying today.

In this new world, as far as the corporations are concerned we're just a bunch of whores and their all fighting to see who is going to be our pimp.

Re:Isn't it kind of sad

[cryfreedomlove]

How are employees hurt by corporate purchases?

Re:Isn't it kind of sad

[keithjr]

This line of thinking needs to die in a fire. The company exists to serve the employees. As in, the people whose livelihoods depend on the company doing well. Sure, the shareholders have a stake, but they'll move on. Lose your employees, and your company is toast. Thinking that you serve some invisible group of people has caused plenty of CEOs to act against their companies' interests.

I'm becoming more and more convinced that going public, despite the giant bags of money it brings in, is never a good idea in the long run. It puts your company at the helm of know-nothings like Carl Icahn.

Re:Isn't it kind of sad

[Cormacus]

I have no mod points, but I want to say I agree with you 100% For anyone who disagrees, I suggest a thought experiment: How would life be different if the following companies focused on serving their customers and not their shareholders?

1. Insurance Companies
2. Banks
3. Credit Card Companies

Re:Isn't it kind of sad

[RMH101]

No. A company is a legal entity to deliver profit to shareholders. A well-run company would hopefully do this whilst treating employees fairly, because doing so enriched the company long-term, e.g. lower churn, higher productivity. However, if there's a firesale on, this may not make commercial sense...

Re:Isn't it kind of sad

[Martin Soto]

I'm glad to see you got my point completely. Indeed, it is exactly this state of affairs you describe so well that worries me so deeply.

Anything that is not illegal is allowed and is expected to be done if it furthers the goal of making more money.

If I'm reading well, what you're implying here is that all ethical and moral concerns you may have about a particular action should be ignored as long as this action increases profits. This is, once again, the logic behind such tragedies as Union Carbide's disaster in Bhopal, India. I'm pretty sure Union Carbide's behavior was not illegal according to Indian law, but I'm also pretty sure many people inside the company knew what was going on, but didn't act on ethical grounds becase it was legal and would increase profits.

So, this way of thinking can kill people and ruin lifes. It is actually doing it as we speak. I thought capitalism was supposed to make us all prosperous and happy by making resources available where they are needed for wealth creation, and rewarding people according to the value of their contributions. I doesn't seem to me, however, that our current form of capitalism is doing any of these.

Re:Isn't it kind of sad

[roman_mir]

Nope, companies are there for offering goods and services

- how is it, leaving in the dream world? Companies exist to make money for the investors. Everything else is secondary, it's just the means to the end goal - money.

Re:Isn't it kind of sad

[keithjr]

Well, let's look at the example at hand, with Yahoo and Microsoft. What happens if the will of the shareholders ("Say yes! Get bought out!") goes directly against the best interests of the company in the long term ("Microsoft will ruin everything we hold dear and laugh")? The shareholders were begging for Yahoo to take an action that works great in the short term but destroys the future of the company.

No, I'm not being sarcastic, I'm actually curious. It looks like a case of madmen at the helm.

Re:Isn't it kind of sad

[shakuni]

You need to think about the statement a little bit. It is sad for whom ?

Stockholders - No if acquisition gets them the best returns then they will be happy.

Employees - No if acquisition ensures that they continue to have their jobs and do good work.

Customers - No if the acquisition means better products and service.

Bystanders like you and I - may be but they are not relevant.

Acquisition is a very real exit goal for a lot of investors and we need that to exist as if that option doesnt exist it can result in "value destruction" as a lot of good things developed get lost.

Re:Isn't it kind of sad

[Martin Soto]

And what good is money if you don't have any goods or services you can buy with it? Even if you are a soulless capitalist like many slashdotters seem to be, it is in your best interest that someone takes care of actually producing goods and offering services, because otherwise you won't have a lot to do with your loved money. Would you care explaining me how this is supposed to be sustainable if everyone concentrates on making money instead of on creating actual wealth?

Re:Isn't it kind of sad

[PixetaledPikachu]

it is then perfectly OK to release dangerous products, abuse your employees as much as possible under applicable legislation (and then maybe a bit more), harm the environment with your production methods, or risk people's life savings in absurd investment schemas, among many other horrors of modern life.

Companies don't do that because there are rules and regulations. Would you believe that they won't exploit any holes in regulations simply because it is morally wrong?

Re:Isn't it kind of sad

[all_the_names_are_ta]

These kind of comments always crop up in Yahoo! articles and they're depressingly stupid.

The correct way to stop the "dirty business practices" that you describe is through government regulation. The notion that companies will police themselves for the greater good makes as much sense as securing your home through the honor system.

Please answer this for me:

If a company isn't there to serve its owners, then what exactly is the point of owning a portion of that company?

If you wind up anywhere in management of a company I own stock in I'm selling up ASAP.

Re:Isn't it kind of sad

[Antique Geekmeister]

That question is like asking 'how are men hurt by dogs'. There are a legion of ways a corporate purchase can hurt na employee: The stock price of the purchase may be less than the value which the employee expected or otherwise would receive from a better purchaser. The employee's intellectual property can be folded into the purchasing company's business and then discarded, such as is occurring with Oracle and their purchase of Sleepy Cat Software and the Berkeley Database. The purchaser may strip out the asset they consider valuable to their business and discard all other personnel and resources. The employees may be forced to resign or to transfer to another location they don't like. Their medical insurance may decrease incredibly in coverage, which matters a lot to employees with chronical medical conditions. The new company may have short-sighted management who focus only on quarterly profits, or may be so long-minded that they won't reward an eager employee's short-term productivity.

The list goes on and on.

Re:Isn't it kind of sad

[roman_mir]

You seem to be upset about something, why is that?

Money is just a short form for exchanging people's time, time that they have to live, and you know, lives are short. Back to the point. Money is not created in vacuum or for the sake of money. Accumulation of money is accumulation of other people's time investment. Obviously money is only meaningful when it can be actually exchanged for actual people's time and goods and services produced in that time.

Corporations only exist to make money for their investors. Producing goods and services is a side effect of that goal, but nevertheless goods and services are produced, because time that goes into production is the only meaningful thing that can be exchanged for money.

Money doesn't appear from vacuum, thus corporations have to get that money from people who are willing to exchange their money for something that corporations will produce. Thus there will be goods and services. Maybe to you this seems like a soulless view of the world (whatever that means), but this is the real view of the world.

Re:Isn't it kind of sad

[Hognoxious]

I thought capitalism was supposed to make us all prosperous and happy

Mmmm, nope.

Re:Isn't it kind of sad

[Anonymous Coward]

I hate when people talk about companies as if they are people. Yes a company is a legal entity much like a person however the analogy stops there. A company doesnt wake up in the morning and decide that it will be evil. Its the people in the company doing either good or bad things.

So yes a legally defined for-profit company really only exists as an entity to make money for its shareholders. The people in the organization work to improve customer satisfaction to improve emplyee morale or whatever. dont confuse the 2.

Re:Isn't it kind of sad

[Hognoxious]

What happens if the will of the shareholders ("Say yes! Get bought out!") goes directly against the best interests of the company in the long term

Then it also goes against the interests of the shareholders in the long term. That may sound paradoxical or contradictory, but it isn't, because in a way the company is the shareholders. People don't always do what's right or sensible, even for themselves.

Re:Isn't it kind of sad

[CodeMunch]

If all you have to do is increasing profits, it is then perfectly OK to release dangerous products, abuse your employees as much as possible under applicable legislation (and then maybe a bit more), harm the environment with your production methods, or risk people's life savings in absurd investment schemas, among many other horrors of modern life.

Doing so is NOT in the best interest of the shareholders because it brings lawsuits and negative attention to the company which reduces sales and therefore dividends to the shareholders.

Idiots in management may believe such behaviour is good to achieve their quarterly targets but it screws the company longterm.

Re:Isn't it kind of sad

[DragonWriter]

Saying that companies are there only to serve their shareholders, that is, only to make profits, is just a justification for all sorts of dirty business practices.

Unfortunately, if you look at most corporate charters, that is exactly what most companies do, in theory, exist today to do.

Certainly, there is an argument that the benefits granted at public expense to corporations should be given in exchange for some enforceable requirement to serve some public purpose, but that's certainly not the way the law works now. Its simply a handout in the hope that corporations will, in the aggregate, just happen to randomly do public good with the public benefit they are granted.

Sort of like the giant bank bailout, but with even less controls.

Re:Isn't it kind of sad

[T-Ranger]

Within the context of a publicly traded company there there is exactly one point of ethics or morality that matters: make the shareholders money.

Bitching and complaining about companies doing something that isn't nice is pointless. Its like tripping, breaking your ankle, and then complaining that gravity didn't shut of. Gravity pulls down; deal with it. As a person, buy sensible shoes. As a government, have building and labor codes that require railings and fall-arresting systems.

If you want companies to behave, as an individual, shop elsewhere. As a government, legislate that behavior as being required (and make the penalties sufficiently large as to actually be a financial intensive). Companies treat their employees "poorly"? Increase them minimum wage. Allow them to unionize. Companies pollute the environment? Have inspectors, and fine them, severely.

Re:Isn't it kind of sad

[Hognoxious]

And what good is money if you don't have any goods or services you can buy with it?

What use are goods and services if you don't have the money[1] to buy them with?

Alice provides goods and/or services (fnarr!). Bob likes those, and exchanges money for them. Alice takes that money and uses it to buy the goods and services that she likes from Charlie. Charlie takes the money and spends it at Bob's shop. And so it goes. It's not rocket science.

[1] Barter, I hear at the back. If you think about it, money is just an indirect form of barter; if Alice and Charlie want what the other produces, they can make a direct exchange.

Re:Isn't it kind of sad

[elrous0]

Capitalism has no morality or conscience. It's only god is profit. Left unchecked by government regulation and oversight (and criminal laws), of course companies would engage in dirty business practices. Hell, they *already* do as much as they think they can get away with.

Re:Isn't it kind of sad

[Hognoxious]

the benefits granted at public expense to corporations should be given in exchange for some enforceable requirement to serve some public purpose, but that's certainly not the way the law works now.

The government could certainly pass a law forcing a cake factory to release its employees (at comapny expense) to work one day in five on road building, teaching or law enforcement.

Or, get this, the government could just let cake factories get on with baking cakes (it's what they're good at!) but make it obligatory for them to give it a portion of their profits. Then it could use that money to, I dunno, provide roads and schools and police.

Sounds neat in theory but I can't see it being popular enough to catch on, to be honest.

Re:Isn't it kind of sad

[Anonymous Coward]

Saying that companies are there only to serve their shareholders, that is, only to make profits, is just a justification for all sorts of dirty business practices.

This is absolutely false. By way of example, would that reasoning hold up in any court of law for any transgression civil or criminal? "We dumped pollution in the river to improve the profit margin! ... GUILTY!" If someone lacks ethics, it matters not if you tell them the company's goal is to make profits or serve the community. They'll say, "sure thing, boss!" and rob you blind. By the way, the right answer is the purpose of the company is what the owners choose. Different owners have different motivations. One may open a thrift store to serve disadvantaged customers and the thrifty! Another may start an online venture just to attract angel investors, make a quick buck, and move on to the next score. Either person or company may engage in "dirty business practices" and it matters not what motivated the owners.

Re:Isn't it kind of sad

[Hognoxious]

You are right, the customer is king and that any companies primary goal should be to serve their customers.

The customer wants the world, and he wants it for free (AIBNAIS). Not a sustainable business model.

Now days, for most large corporations the customer is the stock holder. We, the consumers are the product that is being sold.

Talking about ad driven businesses the second part is often correct, but the customers are not necessarily the stockholders nor vice versa; it's the advertisers that are the real customers.

The stockholders are the ownwers, same as it ever was.

Re:Isn't it kind of sad

[Martin Soto]

Bitching and complaining about companies doing something that isn't nice is pointless. Its like tripping, breaking your ankle, and then complaining that gravity didn't shut of.

There's a big difference: gravity is ruled by the laws of nature, company behavior isn't. Actually, companies are nothing else than a bunch of people that have access to certain resources. If I deal with any of these people personally, I expect them to behave morally. Why should I accept that they behave otherwise when representing their company? Just because they have to serve some random stakeholders?

Many people seem to think that companies are autonomous beings, with a live and motivations of their own. They aren't. All actions of a company are, in reality, the actions of people working for the company. I'm sure that if those people were held accountable for what they do in the name of their companies as much as they are held accountable for their personal actions, this world would be much much better.

Re:Isn't it kind of sad

[Anonymous Coward]

You'd mostly be pissed at yourself, for not actually selling your shares when you supposedly knew it was a good deal, but opting for a couple of bucks less on the open market maybe. Yeah, I'd be pretty pissed at myself for not selling right there and then, instead of losing my shirt and 60% of my portfolio. But then, it's a famous practice of the morally irresponsible to transfer one's anger to others - something we forget is all too easy to do without noticing.

Re:Isn't it kind of sad

[Martin Soto]

Mmmn, guess you're rediscovering economic theory here. Sure, money is intended to represent wealth. You trade the actual wealth you produce for money, and later you can trade that money back for wealth in some other form.

Still my point holds: the important part are the goods and the services, because those are the ones you can directly benefit from. In that sense, money is just a means to an end, not the end in itself.

Re:Isn't it kind of sad

[msromike]

No. They are there to make the most money possible for the shareholder (owners) of the company. You confuse the best methods of maximizing profit with the actual mission of making the most profit. They do not have to justify anything, but they may be held accountable for business decisions that are made.

However, all the things you mention have nothing to do with the real mission. They may at various times choosee to treat the employees poorly or kindly, or treat their customers poorly or to treat them kindly. Whichever method maximizes profit is the correct method. Shifting back and forth in the spectrum of customer and employee relations is done continually as market forces come to bear.

They should maximize profit at the expense of everything including the environment if they can. If regulation and public opinion compel them to have a "green" policy then they will. They are not going to, and shouldn't do it out of altruism. Altruism is the realm of the individual and not the corporation.

This story is a good example of what happens when you try to put your principles and emotions in front of the good of the corporation. You get demoted from CEO to "chief Yahoo."

Re:Isn't it kind of sad

[Draknor]

People don't always do what's right or sensible, even for themselves.

Right on. 'Investors' is really a misnomer -- more people in the market are interested in short-term results and short-term profits, instead of doing what's right in the long-term. It's no different than you or I feeling craving and going out for a smoke (or a drink, or whatever your vice is). Sure, it may give us cancer in 20-30 years, but it makes us feel better *now*. A buyout may kill Yahoo in the long-term, but it makes us feel better about being 'invested' in Yahoo *now*. Same psychology.

Re:Isn't it kind of sad

[cryfreedomlove]

There is a lot of stuff there to worry about. What kind of remedy would you suggest?

Re:Isn't it kind of sad

[onefriedrice]

That's why Ford and GM don't spend a lot of time building cars that tomorrows consumers might want. Their only focus is to build as many of whatever cars the consumer is buying today.

I'm sorry, but the logic doesn't follow. Ford and GM do exist to give a return on stockholder's investments, but going out of business is not in stockholder's interests. Therefore, they are short-sighted and struggling not because of their intention to be profitable now without regard for the future, but simply because they are slow and mismanaged. It's not any more complicated than that.

Normal rules of capitalism apply: generally, you will find that the interests of consumers and stockholders are actually the same. Companies create better products (consumers win) at a lower cost in order to increase revenue and income (stockholders win).

Re:Isn't it kind of sad

[Anonymous Coward]

The only problem with this is that many a yahoo, as well as being a stakeholder in the company is also a shareholder...some buy shares and options with part of their salary. Jerry pretty much shafted them on the shares and now it looks like many will be quietly swept aside when a new suitor courts yahoo for a takeover.

Re:Isn't it kind of sad

[DragonWriter]

The government could certainly pass a law forcing a cake factory to release its employees (at comapny expense) to work one day in five on road building, teaching or law enforcement.

We're not talking about businesses in general, we're talking about the particular special public benefits granted to corporations.

Now, I know you are trying to be cute and say that taxes are the payment here, but the problem with that argument is that, except for corporations small enough to hit by minimum taxes, the taxation of corporations isn't generally greater (to provide a payment for public benefits like liability shields, etc., that are provided to them).

Re:Isn't it kind of sad

[brunson]

Fuck that. His job is to slap his balls on the table and say, "Who has bigger ones? Come on, show 'em. You fucking pussies."

And I think he's done that quite well.

Re:Isn't it kind of sad

[hercubus]

Seriously, the company you work for does not exist to enrich your life. It exists to enrich the life of the owner(s). You are paid a stipend to perform labor because the owner(s) believe that your work will further enrich them.

when you put it like that, i just feel dirty. i'm a dirty, dirty whore. leave the money on the nightstand

Re:Isn't it kind of sad

[mccrew]

I hereby nominate this post for the "Truly Clueless Post of the Day." How this got scored as "4 Interesting" is a head scratcher for another day.

Of those three, I'd say investors are the least necessary, since a company could grow (however slowly) without borrowing.

Is it possible to pack more fundamental misunderstanding into a single sentence? I will leave it to others to point out what needs pointing out.

Wow, just wow.

Re:Isn't it kind of sad

[pablodiazgutierrez]

Then those people didn't really work in a startup, but in a fairly established company. If you work 40 hours and get only a small part of your salary in stock, it's not a startup in spirit.

Re:Isn't it kind of sad

[Tubal-Cain]

Of those three, I'd say investors are the least necessary, since a company could grow (however slowly) without borrowing.

Do you count the founder as an investor? Somebody started the company, and if they did not borrow money, they invested their own. And because they were the only investor, they are the only shareholder (but a shareholder nonetheless).So even if the company does not borrow any money after the founding, they are still responsible for enriching the owner.

Things like serving your customers well and treating your employees good might not make much money in the short run (maybe even cost you), but they build goodwill and can be very lucrative later.

Re:Isn't it kind of sad

[Tubal-Cain]

I thought capitalism was supposed to make us all prosperous and happy

What gave you that idea? Capitalism just lowers the barriers to making yourself prosperous. Capitalism will only make you prosperous if you:

1. Partipate
   Being an employee is a low-risk low-return investment. You work, you get paid, and count on the fact you probably will be able to work tomorrow. Business ownership is a high-risk but potentially high-return investment. Tend to it long enough and well enough, eventually it won't need your constant supervision anymore. It now provides a steady income with little further effort on your part. But getting it to that point is a long and difficult process, and most people don't make it. It's the fear of "losing it all" that makes people decide to stay in the 9-to-5 job. It's more predictable.
2. Do a good job.
   Are you organized? Did you adequately prepare before going into business? Do you deal completely fairly with your customers? Do you market yourself well?

$700 billion bailouts aside, nobody is just going to hand you money. And (going back to your line I quoted) even if you are prosperous, nobody can guarantee your happiness.

Re:Isn't it kind of sad

[Antique Geekmeister]

You seem to be optimistic about startups. New employees also often work those kinds of hours, but it typically takes six months before they they get stock grants. And the sale of the company, especially in economically difficult times, can be a desperation move as it collapses. A lot of startups fail, and get sold off to competitors. I've even helped manage the integration of purchased startups, and a lot of their staff were very unhappy about the sale.

Re:Isn't it kind of sad

[Hognoxious]

the taxation of corporations isn't generally greater (to provide a payment for public benefits like liability shields, etc., that are provided to them

And I see you're trying to be cute with anti-corporate handwaving, but [citation needed].

Re:Isn't it kind of sad

[Hognoxious]

Mmmn, guess you're rediscovering economic theory here.

I've probably forgotten more about economics than you'll ever know, smartass.

the important part are the goods and the services, because those are the ones you can directly benefit from.

No. The important thing is the money, because[1] it's the thing that drives people to produce goods & services. Bakeries don't produce bread to feed people; they produce bread to sell at a profit. Just the same as most people when they do a job. If anyone tells you he does job X "to help the public" it's odds on he's lying.

[1] in a modern developed economy. On a desert island it might be closer to what you say, but I for one don't live on one.

Re:Isn't it kind of sad

[DragonWriter]

And I see you're trying to be cute with anti-corporate handwaving, but [citation needed].

This isn't Wikipedia. If you care, you can look up corporate vs. individual tax rates yourself. Most business forms that don't pay corporate tax pay individual tax, either as a single individual (sole proprietorship) or as pass-through entities for several individuals (partnerships, etc.).

Euphemism

[oldhack]

"...a new CEO who can take the company to the next level"

So they're not even trying...

And here I thought

[djupedal]

...it was to avoid doing the deed w/MS at any cost.

Dividends?

[copponex]

I just looked at the YHOO numbers and noticed there is no dividend. Watching some prophetic videos of Peter Schiff, he seems to be saying that every American stock is basically a speculative gamble, and that there is no place to invest in a company with a real balance sheet in the states.

Can anyone "in the business" comment on what he's saying? Is there a possibility of returning to the more formal method of investing as a stake/stockholder and receiving a share of real profits?

Re:Dividends?

[AuMatar]

No- because investors today think the stock price means everything. Played that way, the entire thing is a giant pyramid scheme waiting to collape... oh too late.

Re:Dividends?

[nedlohs]

Can't watch video since I'm on a machine without flash (or sound for that matter), but it's Schiff.

So he'll be pointing out that the US economy is fake, that it's all borrow and consume, and the US dollar is set to drop by a huge amount. And hence you should invest all your money overseas, via his firm of course.

He's basically right in principal, though I think he underestimates just how badly the US bursting will hurt the rest of the world, and he doesn't seem to notice that the US housing bubble is a dwarf compared with the UK... On Asia he's probably right, for the end game anyway.

Owning "growth" stocks that pay no dividends is gambling pure and simple. See Enron for how easy it is to create phantom earnings - it's a little harder to do so when you have to pay that dividend out... But that isn't US specific.

I would expect Schiff to not have any huge problems with US miners (of all sorts), US agriculture, and US oil companies. He does have the reverse of the norm view that the US has more "government risk" than other countries.

As in the US is more likely to declare a "windfall profit tax" and steal your dividends when those companies do very well as the domestic economy collapses or to simply confiscate your gold, etc than say China is. The really sad thing is that he's probably right on that one...

Re:Dividends?

[Rufus211]

Only very few tech companies that are huge and have been around forever pay dividends. The only examples I can find in the tech sector that pay dividends are IBM, Intel, Sony and HP.

The entire point of a publicly traded company is to increase shareholder value. One easy way to do this is to simply give the share holders money in the form of dividends. The other choice is to invest back into the company. If the company is still growing then there's a good chance that investing $X million into R&D/employees/capitol improvements/whatever will result in the company improving it's market capitalization by more than $X mill. If that's the case, then that produces more value for the shareholder and is the proper choice.

Basically dividends, and stock buy-backs which are effectively the same thing, are an easy way out when a company has more money than it knows how to make useful investments with.

Re:Dividends?

[Stuntmonkey]

I'm not sure what your question is really about. Certainly many companies -- and nearly all that have been around for any length of time -- are profitable. Yahoo is quite profitable, generating over $600M of profit last year. So in that sense I'm not sure what you mean by "speculative gamble". Yes the market moves quickly and companies' fortunes can rise and fall, but it's been that way since capitalism was invented.

With regard to dividend payouts. In a high-growth company, the investors often prefer the company to retain earnings to fund future growth opportunities. When there aren't enough high-value growth opportunities and the cash starts piling up, usually companies will then start paying dividends (Microsoft, for example).

Because of US tax law, it's actually better for most investors if the company uses extra cash to buy back its stock (thus reducing shares outstanding, and increasing the price of the shares that remain), rather than pay it out as a dividend. The former results in a capital gain, which presently in the US is taxed as low as 15%, while the latter counts as ordinary income. Many companies do stock repurchases, sometimes in addition to dividends: Intel and Microsoft for example. This is another perfectly legitimate way to give money back to the investors.

Re:Dividends?

[iammani]

He is taking about Investors (nowadays called long term investors). These people depend on how good the companies fundamentals are( its called Fundamental analysis as opposed to Technical analysis). They buy stock of companies that have a good P/E (price to earnings ratio) and have promising revenues and cash flow.

The main source of returns they expect is dividend (which depends on the earnings of the company and the free cash it is sitting on). They enjoy the dividends, hold on to the stock, till they believe the company is not going to grow further or they are negative about the outlook about the company or they have need to redeem their investment for investing in companies or papers that they believe offer better returns.

But nowadays companies do not bother about being investor-friendly and stick with their excess cash. AAPL (Apple) is one of those, they have huge huge cash reserves, but do not give dividends, neither announce buy-back of shares. I would rate them among the least investor friendly companies.

In case of YHOO, it is more cash starved and can actually use some from MSFT.

And for the ones who wonder how dividents/buy-backs etc would help the company, its sort of paying money to your investors, so that in case you need cash later, you can get it back from them. You buyback/give_dividents when you are cash rich, the stock value rises as a result, and then when you need cash you sell the share you brought or issue new share at the higher price. Sounds good doesnt it.

Re:Dividends?

[blind biker]

Nokia also pays dividends. I know as I was on the receiving end for a few years.

Re:Dividends?

[Anonymous Coward]

Basically dividends, and stock buy-backs which are effectively the same thing, are an easy way out when a company has more money than it knows how to make useful investments with.

Or basically dividends allow your investors the option to take part of your profits and either put them back into the stock or use them for income or other purposes.

One symptom the lack of dividends leads to is companies feeling compelled to branch out in order to make use of the money they have on hand; they usually aren't as good at their new tacked-on field, and the formerly well-focused company that the investors bought into no longer exists.

Re:Dividends?

[marcosdumay]

If the companies don't issue dividends, the only reason to buy its shares is to sell those later, at a profit. That is a Ponzy scheme, it works on times of inflation and that's all, without severe inflation, if fails. Now, when the companies issue dividends, they can be avaliated on a P/E basis, and bought because of those dividends. There is no need to resell the stocks in order to make profit. That is a stable market (that can become a ponzy sceme sometimes, but doesn't need to be one).

That the US government encorages the first, and not the latter, tells a lot.

Re:Dividends?

[Anonymous Coward]

Dividends are taxed by the IRS as capital gains, so long as they're qualified - you've held it for "more than 60 days during the 121-day period" - which is not a high hurdle to meet. I've liked the times some of my stocks performed buybacks, and feel they're unfairly derided by many, but they are not equivalent to dividends, much less always preferable.

Re:Dividends?

[Anonymous Coward]

Love em or Hate em, Microsoft also pays a healthy dividend and has done for a few years now.

Re:Dividends?

[Anonymous Coward]

Missed one.

http://finance.google.com/finance?q=MSFT

Re:Dividends?

[jabithew]

That is a Ponzy scheme, it works on times of inflation and that's all, without severe inflation, if fails.

It doesn't work with inflation, people just think it's working.

Re:Dividends?

[TheSunborn]

But you are forgetting that they may not be paying dividends now, but they can always choose to do it later. And this choice is really made by the stockholders(Maybe indirectly by voting for the board).

If I own 10% of a company with 10 million in cash, then the value of my investment will be at least a million, even if the company is not currently paying any dividends.

So you may think of the value of a stock as the ability of the company to pay dividends. And if they choose not to do it now, it is in a way the same as you lending money to the company.

If the company is in a high growth marked, then investing all the money now might allow the company to pay much more dividends later, and thus be a good thing. The companies that pay dividends are normally companies that are in a stable marked where they don't need all invest all their profit.

Re:Dividends?

[Rogerborg]

But you are forgetting that they may not be paying dividends now, but they can always choose to do it later

And I can call my bank and say "I'm not paying my mortgage now, but I may choose to do so later." I'm sure they'll understand.

If they're not paying, then they're not paying. And by the way: the value of your investment is what you trade it for at the exact point when you actually sell, not what it's ostensibly worth 5 minutes before that.

Re:Dividends?

[Antique Geekmeister]

It's not the only reason. Recovering corporate control from other voting members, especially those who disagree with the board about policy, is sometimes a big reason to buy back stock.

Re:Dividends?

[Anonymous Coward]

If I own 10% of a company with 10 million in cash, then the value of my investment will be at least a million, even if the company is not currently paying any dividends.

Good point, but you should also note that most companies are heavily to very heavily leveraged.

Another thing to note is that corporations many times do something simply because other companies do it - e.g., when outsourcing became a trend, many businesses didn't even examine the issue before they started doing it, and then they had to undo it when it didn't work. The lack of dividends largely falls under this category, although some headway was made once the tax rates were reduced to capital gains.

Re:Dividends?

[Paradise Pete]

Love em or Hate em, Microsoft also pays a healthy dividend

Based on the current share price, the dividend is more than 2.5%, and the stock has has PEG of only 0.85.
Here's an interesting tidbit - MSFT's market cap is ~171B, which is *less* than what AAPL's was back in January.

Re:Dividends?

[marcosdumay]

Yes, and you are right. If the stockholders bought their stock expecting the comanies to pay dividends at some time, you have a stable situation; risky, but viable and, in general stable. The company can change hands before it issue dividends, the only needed characteristic here is that the company is valuated by the amount if dividends it's expected to pay.

But if they bought it expecting to sell at a bigger price at future, and don't expect the company to issue dividends, you are again at a Ponzy scheme.

Re:Dividends?

[Hognoxious]

If the companies don't issue dividends, the only reason to buy its shares is to sell those later, at a profit. That is a Ponzy scheme

No it isn't. And it's not a Ponzi scheme either.

If I own x% of a company, and that company makes a profit, then I own x% of that profit. It could pay all that profit out in the form of dividends. It could retain it, in which case I own x% of a richer company, so my shares should be worth x% more. It could do something in between. Taxes aside, it makes no difference.

That assumes perfect valuation, but even with all the irrational factors that can push prices hither or thither, it isn't a Ponzi scheme. Not every company is an Enron.

Re:Dividends?

[Hognoxious]

Good point, but you should also note that most companies are heavily to very heavily leveraged.

Debt isn't entitled to a share of the profits (it gets interest instead), so I don't see the relevance. If a company has made a profit of so many million, that's an asset (if they use it to pay down the debt, it's a reduction in liabilty, which amounts to the same thing), so its net value has still gone up by that amount.

Re:Dividends?

[nedlohs]

You should read all my posts then. You'd hope I'm intentionally putting in all those types of errors.

And yes I saw the error as soon as I looked at preview mode - you think I can be bothered clicking Continue Editing and changing things???

There's also "norm" instead of "normal" - that wasn't an abbreviation, that was me making a similar typing error and not caring enough to fix it.

I'm sure there are others too - I don't read the articles, why would I read my own posts?

Re:Dividends?

[nedlohs]

If the company is still growing then there's a good chance that investing $X million into R&D/employees/capitol improvements/whatever will result in the company improving it's market capitalization by more than $X mill. If that's the case, then that produces more value for the shareholder and is the proper choice

That's not true.

It has to be more than the expected returns of alternative investments would be for the shareholders, not just more than dividends would be.

If Treasuries are at 8% then the company better be getting better than 8% returns when it keeps the shareholders money instead of paying it out.

Re:Dividends?

[quarterbuck]

This graph explains it better than I can.
Assume that the earnings of a company is what remains to be distributed to shareholders. If divident is not paid, and the money gets re-invested, this is similar to a compund interest rate - You should be able to cash in the money at some point of time. Either the company finally pays dividents when it stops growing (MSFT) or the stock price rises since the company has a lot more of retained earnings which they reinvested.
If you take the above approach the Price to earnings ratio gives an indication of the inherent value of the company. A non growing company with a P/E ratio of 10 is the equivalent of a 10% interest rate and a P/E ratio of 30 implies a 3.3% interest rate.
Historically the returns from stock markets have been slightly higher than debts (bonds) - the stock markets are riskier and only the high return projects ever get funded. (If it was low return and high risk, no one would invest in the first place). Anyway, the average P/E ratio for the whole market should have been below 10, but in the recent past they were much higher. implying lower returns than bonds or astronomical growth rates.
After the market crash many are saying that the P/E ratios are about right on average, but then there is the risk that markets overcorrect and the markets could go down even further.

Re:Dividends?

[quarterbuck]

Say that to Dell. Kevin Rollins kept buying back stocks (pay out dividents) and made Dell the most efficient at producing cheap computers.
The only problem was that when HP improved its game, Dell did'nt have any buffer cash to change their gameplan. They seemed to have fixed it recently, but from the stockprices I think they have'nt worked all that well.
Some amount of retained earnings are sometimes a good idea.

Re:Dividends?

[quarterbuck]

That is a Ponzy scheme,
This is not true. Suppose you own 1% of shares of a company that is worth $100. Your shares are worth $10.
Now they make $10 profit. They could either give you $1 back or reinvest it back in the project to make the same return the next year. If it all works out as planned, the next year you are holding 1% of a company worth $110 and growth prospect of 10%.
You see how stocks inherently are worth more because the money got re-invested ?
It is not a Ponzy scheme.
BTW, P/E ratio has nothing to do with dividents. P/E ratio is calculated on the basis of earnings which are internal to the company.
Dividends are a bad idea because they get taxed at the company level at 33% and then once again at the shareholder level as either income or capital gains. If you are going to give out money it is cheaper to issue dividents
But your other point is valid. Retail investors HATE selling stocks to make a profit - they prefer dividends much more. Which is why companies with large retail holdings issue dividents and the ones with large institutional holdings do share buybacks

Re:Dividends?

[marcosdumay]

Sorry to burst your bubble, but if you bought some stocks expecting growth, and not dividends, you are part of a Ponzi scheme (and if you expected dividends, you wouldn't probably buy since most are way overvalued).

"It could retain it, in which case I own x% of a richer company, so my shares should be worth x% more."

Only if, by doing so the company has the potential to get bigger profits at future, and return those as dividends. Or, maybe, if the shareholders are planning to dissolve the company, so they'll take all the money at some point. If there is no expectation of dividends, and there is no possibility of dissolving the company out of a bankrupcy, how do you claim that those pieces of paper are worth any thing at all?

Re:Dividends?

[Anonymous Coward]

Some amount of retained earnings are sometimes a good idea.

I know and agree, but want to mention that's not against the point I made.

Another interesting thing to note is that with a company that pays dividends, you're no longer beholden to the strange notion that a company will exist indefinitely. With no dividends, all investors have for returns is stock price - if the company folds, they lose everything they put into it. If a company pays dividends, it can pursue its one good idea; if the company folds after that idea has run its course, the stockholders profited from it all the value its generated.

Re:Dividends?

[demachina]

Since the crash, companies who have cheap stock but still pay their pre-crash dividends are an extremely good investment at the moment, at least as long as they keep paying their dividends. Its really one of the few good ways to invest in equities at the moment.

Re:Dividends?

[TheCage]

Basically dividends, and stock buy-backs which are effectively the same thing

Stock buy backs help sellers of the company (they are the ones who actually get the money). Dividends help holders of the company. As an example to this point, consider all the companies that were buying back shares pre-crash. Clearly they paid more than they needed to (on average, on the order of 40%), so the only people who gained were sellers. If instead they paid dividends, the holders could have spent the money however they wanted. If that spending lost money, at least it was the holders fault.

Just because US tax code has made investors prefer one (worse, IMO) system over the other doesn't mean they are the same.

Re:Dividends?

[AuMatar]

True. Unfortunately, with people's preference for the quick cash rush of the pyramid scheme unless the downturn is long lasting I'd expect to see them reduce dividends and put that money to something silly like buying new companies.

Re:Dividends?

[Rogerborg]

Heh, marked "troll". I didn't know that we had hedge fund managers moderating us now.

Re:Dividends?

[marcosdumay]

I see, you are the 3rd person answering with the same argument. I know the mainstream thinking, but it is wrong. Let's make some thinking experiments: Suppose that this company, that just made a profit of 10% of its market valuation, reinvest all this money on R&D. Now, what should be its value? 110% of the original? But what if this investiment leads to some inovation that causes next year profit to be 30%? And what if the R&D didn't go well, and there is no inovation to show for that investiment? You will probably agree that the valuation of a company isn't as simple as you say.

Now, that it is settled that valuation is hard, tell me: How did you get that initial value you reference? The most accepted way is that a company is worth the sum of all future dividends it will yeld, amortized by interest and risk. If your stocks don't yeld dividends, and aren't expected to do so at future, they are worth US$ 0,00. I've never seen somebody propose a different valuation, except for "the market is always right" (if you ever saw one, I want to know). The problem with "the market is always right" is that it isn't, if you are investing, you are exactly searching for places where the market is wrong, so you can have an edge.

If there aren't dividends, no stock holder will ever get something out of those companies. So, no stock holder will ever by the stock to himself, every one of them will buy to sell it latter, for a different price. Now, there is a name for a scheme where everybody pay for something only because they expect to sell those things at an highter price later. The fact that some people say they reflect the value of a real company doesn't change the fact that, in reallity, there is no connection between the company and those pieces of paper. Anwer me, if the company goes away and nobody gets informed will there be any difference on the way it is traded?

Re:Dividends?

[quarterbuck]

The net-worth of the company is the sum of all future dividends
I would propose that the net worth of the company is the net earnings of the company
For example consider the Oil Shock of the 80s. Government imposed a 60+% tax on the companies as windfall taxes. This meant that for every dollar earnt, the company could give the investors only 40 cents. This meant that large capital expenditures were a good idea - which they did by investing in Oil exploration. So now instead of the investor owning a company, they also owned large amounts of Oil (which is almost as liquid as cash anyway). This Oil would not be taxed until it was dug out - and so they were not dug out till the taxes changed back.
So in the interim period while the company was investing in digging for oil (and apparently losing money, in accounting terms), the company really was growing. There WAS a reason to not pay dividents and the company valuation to go up. They did start paying dividents later though.
The other alternative was for the company to transform itself into a Oil trust. Essentially break the company apart, stop digging for Oil and give out all profits as dividents and pay no taxes. This is something Boone Pickens pioneered - And this lead in the longer term to the death of any company he touched since they were no longer looking for oil. The investors got their dividents in the meanwhile though!

Re:Dividends?

[marcosdumay]

"They did start paying dividents later though."

That's what makes they different from what we are discussing here. Ok, to be pedantic, what made them different was that the people trading their stocks expected them to pay dividends later. People don't expect lots of companies to ever pay dividends now.

And you are right, I forgot to include taxes into my definition.

Yahoo is...

[retech]

the next AOL.

Re:Yahoo is...

[apostrophesemicolon]

Jerry Yang actually, according to this article, considered acquiring AOL.. But with declining stock prices, they are running out of steam to keep up with the dailies, let alone for acquisitions.

@ Yahoo and Sarah Palin

[Anonymous Coward]

Would you just go away already??

Re:@ Yahoo and Sarah Palin

[Anonymous Coward]

Yeah, competition sucks. It makes life far too difficult, especially the part about having to ignore the competitors I don't support. Why can't my choice be the only damn one in existence?

Something everyone always forgets, or just ignores

[Anonymous Coward]

Jerry Yang was never meant to be Yahoo's CEO.

He took ever when Terry Semel took a gigantic shit on the company. He failed to act on Yang's and Filo's suggestion that Yahoo acquire Google when that was still possible. This was when they were still using PageRank, prior to their major search engine acquisitions. I rememnber at the time that this was going on, I was constantly talking to Yahoo people about how much sense it made for them to do so. I also remember the looks on their faces when they all came back with "Semel's not going to do it." He also amassed a private fortune at the company's expense while letting Yahoo go down the drain.

They kicked him to the curb and fell back on Yang as interim CEO. He finally stuck to the position when it looked like that was all that would keep the shareholders happy. But it was simply never supposed to happen.

If I blame Yang for anything, it's for ever letting Semel head the company in the first place.

bye bye

[cuby]

Refusing M$ proposition was probably one of the worst business decisions ever made, and can lead to the end of the company. The CEO is there to execute the shareholders interests... Unfortunatly this is not the case in a lot of places.

Re:bye bye

[Elektroschock]

Well, but a Microsoft acquisition would make the company stop operations anyway.

Microsoft is desperate to spent its cash and fight google. Now all competitors know that Microsoft as a business is going to die. Because the main cash cows, Office and Windows are under fierce attack. No one depends on Windows anymore for accessing the cloud and Office will continue to be the cash cow unless competitors or the cloud will take over. For me OO.org is now on the same level. Just a matter of time for Microsoft to collapse. Meanwhile Microsoft burns cash and creates new enemies by dumping money into unprofitable markets, see e.g. the Xbox challenge, see their attempt to position Live search against google, Silverlight is nothing but a Flash me-too etc. etc. Microsoft is in urgent need to diversify its business while the growing alliance of competitors hunts after their cash cows.

Re:bye bye

[Amamdouh]

Looked like his judgment was clouded by arrogance. He did not refuse to sell he just refused the price claiming it was too loo and claiming that Microsoft gravely overestimated Yahoo's problem hmmm... Guess what Yang, seems you were the one overestimating your value. John C Dvorak made an interesting argument about this deal "Yahoo! is not worth $44 billion. Period. You could buy General Motors lock, stock, and barrel for $14 billion, name all the cars "Google Sucks," and get more bang for the buck."

Re:bye bye

[iammani]

You could buy General Motors lock, stock, and barrel for $14 billion, name all the cars "Google Sucks," and get more bang for the buck."

wouldnt it be cheaper to have windows screensaver say "Google Sucks" instead?

Re:bye bye

[prisoner-of-enigma]

Now all competitors know that Microsoft as a business is going to die. Because the main cash cows, Office and Windows are under fierce attack.

Your statement is correct insofar as all things happen if given an infinite time span. Excluding an infinite time span, your statement is really, really reaching.

Office and Windows are huge cash cows for Microsoft. Office alone commands more than 90% of all office productivity software in the world. If you think that's going to be replaced en masse by OpenOffice or Google apps anytime soon, you're delusional in the extreme. It may work fine for you, but the vast majority of the business world does not agree with you. You can argue the merits of OO vs. Office all day long, but in the end it comes down to where businesses place their faith. Despite the huge price, despite the bugs, despite the bloat...they choose Office. They do it not only because it's the devil they know but because it's the devil everybody else uses as well. Businesses do not operate in a vacuum, and they must be able to reliably and accurately exchange documents and data with other businesses. With Office they are assured of this. With anything else it's a crapshoot unless you're dealing with only the most basic types of documents, spreadsheets, or presentations.

As for cloud computing, the idea will gain traction over time, but Microsoft isn't sitting idle. Do you think Microsoft isn't investing in cloud computing? They are, and quite a bit at that. If and when cloud computing becomes a panacea, Microsoft will control a healthy chunk of it. Maybe more, maybe less, but there is no doubt they'll be a sizable player.

It seems rather obvious that you're letting your anti-MS stance interfere with objectively judging the situation. Microsoft just finished hugely profitable -- in some cases, record profits -- for the last couple of quarters. The company has cash reserves eclipsing pretty much every competitor on the planet. You obviously want Microsoft to fail, but that does not mean they're anywhere near failing. Quite the contrary, actually. You need to stop letting your bile skew your judgement.

Re:bye bye

[Elektroschock]

Microsoft never understood the internet. They failed with search and for the same reason will fail with the cloud. They are in desperate need to get new markets. It is true that the cash cows will continue to generate profits but what a company with large growth rates will have to sustain them or the stock market gets nervous.

OpenOffice is a low investment effort for its competitors and eats quite a chunk of their market, the more the market becomes competitive the more Microsoft has to lower its price offers. It is the only party you can expect to lose from these investments.

Netbooks now offer the opportunity to put Microsoft under pressure on the Desktop and offer cheaper deals. Hardware vendors play their games with Microsoft. Same is done by large scale customers which start their Linux pilot for procurement flexibility.

In many other markets the company actually buys market share at the expense of established competitors that fiercely fight back. Everything the do strenghtenes the alliance of competitors and there is simply no alliance partner except software sales and Symantec.

Re:bye bye

[prisoner-of-enigma]

Microsoft never understood the internet.

If you're referring to the beginning of the commercial Internet, you're right. If you're referring to current events, you're wrong. MS has a huge presence on the Internet. Its Internet Explorer, for all its foibles and shortcomings, is the most popular browser in the world by a factor of two or more over Firefox. MS may not be as net savvy as you'd like, but they're not nearly as bad as you claim.

they failed with search and for the same reason will fail with the cloud.

You really must tell me where you bought your crystal ball. I'd like to know what next week's lottery number is. Can you prognosticate that for me? I'll give you half the winnings.

OpenOffice is a low investment effort for its competitors and eats quite a chunk of their market

According to Wikipedia, Microsoft Office has 95% of the productivity software market as of August 2007, the most recent period sampled. If OO is eating "quite a chunk of their market" then you seriously need to re-examine your definition of "quite a chunk." OO adoption is almost small enough to be considered a margin of error. Now, do you really want to keep going down this road of unsubstantiated hyperbole?

Netbooks now offer the opportunity to put Microsoft under pressure on the Desktop and offer cheaper deals.

According to IDC, netbooks sales comprise 7.3% of all "laptop or other mobile computing device" sales worldwide. If you consider that laptop sales are roughly equal (for now) to desktop sales, then netbooks comprise perhaps 4% of overall computing platform sales. So, put another way, 96% of all computing sales are not affected by this fanciful death throes scenario you keep trying to paint. Is MS in a good position to exploit netbooks? No, it is not. Is it something MS should be worried about? Yes it is. Is it something that's going to kill MS anytime soon? Not a chance.

I'll also point out that Windows Mobile 5.x and 6.x are eating into revenue from RIM and Symbian. True, Apple's iPhone is closing in even faster, but unlike Apple, MS depends on OEM's to make phones. Apple's ability to meld an excellent OS with gee-whiz hardware is something MS simply can't match without getting into the hardware business.

In many other markets the company actually buys market share at the expense of established competitors that fiercely fight back.

You mean like Netscape? Yeah, they "fought back" so effectively they're no longer around. Face up to reality, bub: the list of companies that have successfully fought MS is a helluva lot shorter than the list of those crushed to tiny, insignificant pieces. I'm not passing any judgments on whether it's right or wrong, but it is true. Unlike you, I don't let wishful thinking shape reality.

Re:bye bye

[Elektroschock]

It is irrelevant how many customers actually switch to OpenOffice.org. It is enough that they "consider" to switch. Before OO.org 3 Ms-Office was ahead, with Office07 they revamped the user interface which leads to a situation that software pirates prefer earlier versions. If you don't depend on Office anymore prices will go down. OO.org may be a second best choice for many users but it is just a matter of time to surpass the Microsoft product.

As of Firefox it is now the better browser. IE users take the IE because it comes preinstalled and is good enough. IE does not generate any profits for Microsoft.

Executives who can chose a MAC these days, custom applications are dependent on the www browser. You can more easily switch. You don't depend on the platform anymore.

New markets Microsoft enters mean new opponents. They go into web advertisment and meet Google. They go into game consoles and meet the established manufacturers like Nintendo etc etc.

Netscape was a young start-up company without a product. Netscape's AOL later was paid by Microsoft to continue to use the IE engine, a real payoff of gecko investments. And now everyone uses the gecko based Firefox and others like Apple develop the open source Webkit browser. The IE monopoly is gone and the same will happen to more valuable products.

Re:bye bye

[prisoner-of-enigma]

It is irrelevant how many customers actually switch to OpenOffice.org.

I love it when you move the goalposts. First you claim OO is murdering MS. Then you say it's merely taking chunks of revenue. Now you say it's "irrelevant" whether people actually switch or not. Brilliant! You do realize, of course, that you're making a fool of yourself, don't you?

As of Firefox it is now the better browser. IE users take the IE because it comes preinstalled and is good enough. IE does not generate any profits for Microsoft.

I prefer Firefox myself and agree it's a better browser. I also agree IE is "good enough" for most people, thus they never switch from the pre-installed solution. As for IE not generating any profits, I don't think Mozilla is making much money these days, either. Hey, I think I found something "irrelevant" in your point! However, I don't think it's what you had in mind.

Executives who can chose a MAC these days, custom applications are dependent on the www browser. You can more easily switch. You don't depend on the platform anymore.

Apple's overall market share remains under 10% as of the latest data in Q1 2008. It's even lower if you remove "educational" users and strictly look at commercial businesses. So, although Mac use is on the rise, it still represents a tiny fringe of the overall market. Wait! Let me guess! You're going to say that's irrelevant, too, aren't you?

New markets Microsoft enters mean new opponents. They go into web advertisment and meet Google. They go into game consoles and meet the established manufacturers like Nintendo etc etc.

Thank you, Captain Obvious. I'm sorry, did you have a point you were trying to make with this statement?

The IE monopoly is gone and the same will happen to more valuable products.

Actually, there never was an IE monopoly. As any intelligent person knows, Mosaic was the first browser to have a monopoly, followed later by Netscape. Netscape, which you may recall if you are old enough to have been out of kindergarten back then, charged money for their browser. An actual money grubbing monopoly! Curse those greedy bastards! So MS countered with the utterly ridiculous Internet Explorer 1.0, which everyone chuckled at and then went back to Netscape. But MS steadily improved IE, and since it was both bundled and free, they ran Netscape out of business and into the arms of AOL. Note at no time did MS have a monopoly on browsers. Theirs was just cheaper (free, actually) and bundled. Netscape was not. After Netscape failed, Mozilla picked up the banner, so IE still didn't have the monopoly as you claim. Now we join the present, where Firefox goes head to head with IE, both are free, and neither has a monopoly. So, far from IE "losing" its monopoly, it never had one. If anything, Netscape had and lost a monopoly. And it's a good thing, too, if you consider how pathetic the later versions of Netscape were.

So, having debunked your dubious claims and made good fun of you in the process, do you care to embarrass yourself further with half-truths, fabrications, and fairy-tale wishing? Or can you just admit your emotions got the better of you and you temporarily lost your hold on reality?

Re:bye bye

[Elektroschock]

I love it when you move the goalposts. First you claim OO is murdering MS. Then you say it's merely taking chunks of revenue. Now you say it's "irrelevant" whether people actually switch or not. Brilliant! You do realize, of course, that you're making a fool of yourself, don't you?

It is actually the same.

OpenOffice is a competitive instrument. It damages the monopoly business of Microsoft and is going to kill their cash cow. For this to happen it is not necessary at this stage that users actually do switch. It is enough that they can threaten the vendor to do it, so lower their dependence. There is a whole economical teaching around it popularised by Thatcher, the theory of 'contestable markets'. In the Thatcherism it was a bogus argument to reduce the powers of antitrusts regulation but of course it is a valid argument. Open Office makes the Microsoft monopoly contestable, so they cannot charge monopoly prices anymore. Look what Microsoft cheap deals Microsoft offers public institutions these days. Everybody knows that the actual switch to another product will be a landslide because of network effects that buffer the switch.

In short contestable market means that the market share of the competitors is not relevant but the potential to gain market share. Many political systems are built on these premises. Certain parties will never actually lead the government but they have the potential to take over which influences the governing party.

As of the obvious creation of new opponents the dilemma for Microsoft is that regardless which markets they enter they face established competitors which they need to outspent to buy market share. Microsoft needs to enter these markets to diversify its business. The Xbox is a perfect example. The entertainment section of Microsoft continues to make a big loss. But of course them entering these markets also damages established competitors who turn anti-Microsoft and build alliances with other business adversaries, even if it is just symbolic. Eclipse e.g. is an example of IBM teaming up with SUN to threaten Microsoft's position in the developer sphere.

I've been cheering his rejection of Microsoft...

[jbm]

...and I hope I'm not the only one. I actually use Yahoo Shopping on a regular basis, but if Yahoo were acquired by Microsoft I'd stop immediately, and find an alternate vendor-aggregator. Just a matter of principle (and maybe as much aesthetic as anything), but Microsoft just icks me out.

Kinda funny because it troubles me little to support an empire which would probably be just as evil if it had the same amount of power, Apple's. But Apple has an aesthetic sense, and has thus slipped perhaps-irrationally behind my defenses.

This whole Yahoo mess is also a fine example of the downside of going public -- you have amoral raiders screaming the battlecry "shareholder value" and using that to bludgeon anyone in a company who makes a principled decision which might not maximize stock prices in the short term.

(Mod me +2/-1 incoherent?)

Re:I've been cheering his rejection of Microsoft..

[FeepingCreature]

Yahoo! Mail user here. Same problem.

I really hope they make it.

He's so screwed!

[Viree]

Should have sold it back when M$ was offering $33 a share. It's kinda pathetic he had to beg M$ to buy now. I don't think he has done enough "plan B" for Yahoo as a company. It doesn't take a genius to predict that regulators in US won't be too happy with this kind of merger with Google.

Re:He's so screwed!

[Cowmonaut]

It wasn't a merger. Face it, the Yahoo Ads division is a total joke. It's bleeding out cash because everyone wants Google's Ads for the most part.

Killing that division is a smart move, but they feel they have to have some form of ads on their search results if they want businesses to come to them. Still not following the logic at this point on that.

The point is though, they were going to become customers of Google. Just because a company *can* do something doesn't mean they should. Personally I think that this was a bad decision on the anti-trust fighter's part. It pretty much says if you have a web presence and are using google don't get too popular.

Re:I've been cheering his rejection of Microsoft..

[apathy maybe]

Yeah, I've got two Yahoo email accounts I've had since the Nineties (they said they were for life, I hope they meant my life, rather than their life...).

I like the Yahoo Mail interface, even more than the Gmail one in many respects. I've got a stack heaps of old emails (dating back 10 years almost).

But if Microsoft bought up Yahoo, I would be out as soon as I could.

Luckily I have access to POP for Yahoo, so I could just download all those emails that way (I should do that anyway...). (For those of you who have Yahoo email accounts, but don't have POP, I was going to tell you how to do it, but I can't get into my email account ... :(.)

Why don't I want Microsoft? Because I don't trust them. I don't trust Yahoo either, but inertia keeps me there...

0 result

[FornaxChemica]

Yahoo, under fierce financial pressure, has begun a search to replace company co-founder Jerry Yang as chief executive

"Your search did not match any documents."

Re:0 result

[codeButcher]

One has to wonder when Google will start to offer Search and Replace functionality...

;-)

Not me!

[Anonymous Coward]

I just send all my email steganographically embedded in anonymous Slashdot comments!

Re:Not me!

[Anonymous Coward]

I just send all my email steganographically embedded in anonymous Slashdot comments!

Me too!
---
fiergfh erh 349uth t8394tj0394j4u n03tn8uthv 34#$Y^N$%Y^ 4jyh ig425o @%YJ@%$G ^H39256yk @$%JMGI(542 y0945jmy 2rmnghM $%YH92 mY @OHm 2 yhKERGMN^OJMET )(YM#!QOP4y 34q %JAERIH j45erayhJ 45YHJ %^opYHJ $%GH$%Qjmt am%ejij qhj5 VWQJ68wqyj q $%iy q5IOYjvb 54ioymv 459yhkj 9456 hk^TR(%hj 945yhj4509gjc 095y6tj$%Pytjc 9 yjv945,v jy yj945 yt45jyj945Jy#$%JT(J#$C %TJV #$6j 45YB y45hyJ$%IOy 34yt ij34509u394rjmG#$ GJ45yj #$tb 34jmopb yj4 Yjb %YB 4j5N $j%YBkj5y6j0 yb k459ykjh#$% YUJB #$%^(UJ#bn 9ujn 6jb u 56ubn j6u 53bn u3JU^JU(#J^ukb6)_ ykj)^#% TGJ TRYGIJ GH IJTRYH)ETRJ HJ%^ HJ%^M )IHM%^YKM I(%^YKJ)I$%^MYU_$LYT)$%^GLYI(%^)UYKMB(^UyM 4560u7 m$%^ UM I(%UM (I%^ MUI( $%^MU
---

Re:I've been cheering his rejection of Microsoft..

[shutdown -p now]

... a company who makes a principled decision which might not maximize stock prices in the short term.

It's all well and good when there is any "long term" to think about... but in the case of Yahoo, there's simply none. So it was a bad decision no matter how you look at it.

Jerry Yang to be replaced?

[AndGodSed]

Hmm... has someone Yangked his chain at last?

(Sorry, It's horrible I know, but I could not resist...)

Re:I've been cheering his rejection of Microsoft..

[Znork]

...and I hope I'm not the only one.

Considering the reaction of Microsoft stock during the acquisition period, you're joined by a lot of Microsoft shareholders.

I think trying to acquire Yahoo was more about Steve Ballmers ego needing some marketshare against Google, rather than any form of sane business for either company. I suspect Ballmer got told by the board to concentrate on core business instead of his ego, hence the abort of the takeover.

Apart from some speculators who've gotten what they deserve, it's hard to see why anyone would have any interest in the deal; like you say, yahoo would lose a lot of it's five customers, and Microsoft would get a company whose employees certainly wouldn't be thrilled to be working for them.

Hope Yahoo survives

[iammani]

It would be bad if yahoo's market shares was gobbled by google. I hope yahoo survives atleast till there is a good enough competitor in the search engine market (of course other than google).

Why aren't shareholders suing?

[Phurge]

I think the Yahoo/Microsoft saga is one of the most shocking displays of directors' self-interest vs their shareholders' interests. For the sole reason of maintaining independence, Yang and the rest of the Yahoo board instituted poison pill defences worth millions, attempted to a deal with a competitor which was good short term but very bad long term and held out for a price (in the absence of any other interest too) that was way above their previous closing price.

In hindsight shareholders have lost $20 billion. At the time of the offer the premium was around $10 billion. Astronomical numbers to waste just so a board of directors can maintain their personal wish to remain independent.

Its an indictment of the USA's corporate law that shareholders have not sued for breach of fiduciary duty. If they can, but haven't, well they deserve all they got.

Jerry Yang - good riddance. Just becasue you can create an online yellow pages in your garage, (and get very lucky), does not qualify you to run a billion dollar company.

Re:Why aren't shareholders suing?

[Znork]

I think the Yahoo/Microsoft saga is one of the most shocking displays of directors' self-interest vs their shareholders' interests.

With that sentence I was unsure which directors and which shareholders you were referring to. If you recall, Microsoft lost more value than Yahoo gained on the bid.

In hindsight shareholders have lost $20 billion. At the time of the offer the premium was around $10 billion.

Half of which was in Microsoft stock. Which is also worth significantly less today.

The speculators could have sold at any time they wanted. Holding onto or speculating in stock in a bear market is actually not guaranteed to make a profit. If they have any complaints about that, they should apply to convert to a bank holding company and get bailout funds.

Re:Why aren't shareholders suing?

[Anonymous Coward]

Mod parent up. The buyout offer was part stock, which is NOT fucking guaranteed to keep its value.

Also God forbid the controlling influences in a company look for something besides instant gratification.

Re:Why aren't shareholders suing?

[Anonymous Coward]

Sue for what? Shareholders had their say this past summer when they voted against Carl Icahn and his proposed slate of directors - he would have moved to sell the company to Microsoft. Instead they put on blinders and ignored the true magnitude of the downside from staying the course with Yang & co.

It should have been obvious back then to any shareholder who wanted the MS deal to go thru, that nothing sort of a market game changing event would convince Yang & co to sell to Microsoft. Unfortunately for those people who chose to hold on in that belief, a market meltdown happened .. and along with it, any chance of Microsoft wanting to buy Yahoo went with it.

You have to hand to Steve B. He is one hell of a poker player. Without spending virtually a dime, he's completely moved Yahoo from focusing on their core business into sheer panic mode, looking for any possible alternative suitor. Just witness the exodus of management from the company. Those people know the company is going nowhere. Now, the company is going to die a long death with a whimper. Eventually it will get picked up for peanuts once they've almost destroyed what is left in the value of their brand.

Speculation and Investment

[OakLEE]

First off, I watched that video, and Peter Schiff's comments, while prescient, did not call "every American stock" a "speculative gamble." His comments mostly had to do with the unwinding of the credit and housing bubbles, and what little reference he did make to stocks were with respect to financial companies, and with respect to those, he was of course right.

Financial companies' balance sheets are notoriously tough to understand and far from transparent. Go look at a company AIG or Goldman Sachs's 10-Q, and then look at a company like Apple or Caterpillar's and you will see what I mean. In part it's due to the nature of the beast because financial companies often hold all sorts of securities, loans, derivatives, and other paper, and they simply cannot line item all of these in even a couple hundred pages. Additionally some of these assets do not have a liquid market to trade in (i.e., they rarely if ever change hands), and thus, their current value has be be calculated based on projections and models.

Now back to your question of a formal method for investing, there are plenty of books out there for that, and it would take more than one post to outline one. However, here are some simple guidelines for a conservative investor to follow:

1) Always invest in companies that pay dividends. There are plenty of companies out there that pay pretty sizable dividends if you look outside the tech sector. I could go on forever about this, but safe to say that dividends are not only an instant return on your investment, but also if they are reinvested they can act like compound interest. Also, make sure the company is earning enough to pay out its dividend.

2) Only invest in companies whose business you can understand. This is for piece of mind, and will allow you to better see how changes in the economic landscape will affect a given company whose stock you own.

3) Always diversify your investments. No one stock or business sector (e.g., tech, health care, oil, materials) can make up more than 20% of your portfolio. Look at the tech bubble in 2000 or the financial crisis this last year. If you were all in tech or financial (respectively) you were probably did really well during the boom but were wiped out by the bust. Diversification helps mitigate this risk. It'll keep you from maxing out your returns, but it'll also prevent you from catastrophic losses.

Fundamentally, any investment involves taking a risk. The greater the risk, the greater the reward. The key to investing is to understand the downside risk and the potential upside of your investment so that you can make an informed choice in your decision.

Re:Speculation and Investment

[hondo77]

1) Always invest in companies that pay dividends.

Oh really? Two words: Berkshire Hathaway.

Re:Speculation and Investment

[nedlohs]

It's a holding company.

So it owns other companies that pay it dividends and uses those to buy yet more companies to pay yet more dividends.

If you think Warren Buffet is a better investor than you, then go ahead. If you don't then you must be pretty good at that stock picking thing :)

What can be done?

[biscuitlover]

It's a tricky situation for Yahoo... the way I see it - and I'm aware this might be horribly oversimplified - they have two ways to turn things around.

1) Improve their market share in search - not easily done, considering Google's spending power and constant innovation in this area. Microsoft have been haemorrhaging money trying to compete here, and it doesn't seem to be getting them very far - look at the lukewarm reception to their cashback scheme for evidence.

2) Start to better monetise their online tools and content (Pipes, Shopping, Answers etc.). If anything this is even trickier... even with pipes winning numerous plaudits in the industry and a huge user base on the likes of Answers, turning these into a major source of revenue is a tough problem.

I realise this is quite gloomy, which is a shame because I really want Yahoo to succeed, but let's be honest - it doesn't look too good at the moment does it?

Re:What can be done?

[zuperduperman]

I don't get all this hand wringing as if Yahoo is going broke.

They are booking a profit of ~ $600m / year. Steady or increasing for years now. They own the #1 visited web site on the internet, zillions of people using email, IM, Answers, buzz ...

Why such a gloomy analysis?

Who would be a new CEO?

[Fri13]

I know next good CEO... how about Bill Gates... he is "retired" or get a Steve Ballmer there... Microsoft needs better CEO so he could be free. Even better, get a Steve Jobs and we could get yMail, yBrowser, ySearch etc. But because Yahoo! is a internet search (etc) company, without multimedia and computers, Steve would not leave Apple....

Re:Who would be a new CEO?

[earlymon]

The name you seem to be looking for is John Sculley.

Re:I've been cheering his rejection of Microsoft..

[blind biker]

...and I hope I'm not the only one.

No, you're not. I like Yahoo the way it is now. Just as I liked Hotmail the way it was before Microsoft fucked it all up. Sadly, many current Hotmail users have no clue that there was a time when Hotmail was streamlined, efficient and uncluttered. It ran on FreeBSD. It just worked without sucking.

Microsoft added the suckage to Hotmail, I am sure they'd manage to do the same with Yahoo.

Sue and expect Yang to pay the shareholders $20b?

[iammani]

I agree with the sue part, but what would be the compensation claimed by the shareholders and who should pay for it?

Should it from the pockets of Yang and the board of directors or should it be from the company's coffers (which coming to think of it, would inturn pull down the share value even further and spawning a new set of law suits)

Re:I've been cheering his rejection of Microsoft..

[Anonymous Coward]

I hear ya. While I don't use Yahoo shopping, I do have a pro account on Flickr, for instance, and if M$ had bought Yahoo, I would've been in the rather uncomfortable position of having to decide whether to pay M$ money or move to Ipernity or so. I'm glad I don't have to do that now.

Re:I've been cheering his rejection of Microsoft..

[mapkinase]

I worked for 6 years in a company that just went public when I joined it. First they fired the worst, then modest performers and the final round (after I left) - the best.

Now they are selling legacy software.

And the shares dropped that much anyway

[Anonymous Coward]

So unless they cashed in (and why not cash in when Yahoo! shares were at their highest?) the result of the shares would have been nuked big time too.

PS IIRC, the $33 deal was shares rather than cash.

PPS is $10 a year for 10 years more or less than $33 one-off? Yang was looking for the 10-year payoff, not the August one.

Re:And the shares dropped that much anyway

[Attila Dimedici]

S

PPS is $10 a year for 10 years more or less than $33 one-off? Yang was looking for the 10-year payoff, not the August one.

Except that it isn't $10 a year for any length of time, the $10 share price is a once and done deal (once you sell your share for $10, you don't have it anymore). It was $33 one off when MS made their offer, and now it is $10 one off on the open market.

Re:And the shares dropped that much anyway

[all_the_names_are_ta]

Given YHOO pays no dividend, where exactly did you get this $10 a year for 10 years idea?

Re:And the shares dropped that much anyway

[elrous0]

Exactly, unless I get to sell each of my shares 10 times instead of just one, this argument is hogwash.

Re:And the shares dropped that much anyway

[Tubal-Cain]

He's not selling it at $10. He is hoping that share will bring him $10 dividends every year for the next 10 years.

Re:Sue and expect Yang to pay the shareholders $20

[Phurge]

I'm not a lawyer but my understanding is that directors personally duties to the company's shareholders. So the shareholders should sue the directors. They're never going to get the $20bn back, but they should get some compensation (and send a message about how directors should behave)

Re:I've been cheering his rejection of Microsoft..

[Anonymous Coward]

So I hate to be a wet blanket, but do you have any actual legitimate evidence that Apple would be as evil as Microsoft given the same position? Because while it's an awfully popular meme around here, I've yet to see a defense of it that doesn't boil down to a gut feeling.

Not quite bye-bye

[Anonymous Coward]

To blame mere arrogance is to simplify the situation to petty and infantile proportions.

Yang didn't want to sell out to Microsoft, effectively killing his baby. It's not arrogance that drives this reaction, it's concern motivated by fear. Anyone who's ever met the man will tell you this. I myself have been told this by Yahoo people that I trust. Shit, anyone who's ever cared about one's own creations will tell you this. You can't take any of his statements of undervaluement at more than face value. You certainly can't extrapolate arrogance from them. They were meant to assuage investors, rally the troops, and pacify the media circus. If he'd taken Ballmer's offer, he could have said whatever he wanted, since the investors would have already gotten what *they* wanted.

Jerry's strategy of sandbagging Ballmer preserved Yahoo at the shareholders' expense. He and his management team were NOT supposed to do that, and investors have a right to be angry. But damn it if I'm not grateful as a long-time daily Yahoo user and customer whose investments in the company are not in the form of stock.

In the end, do I think it was the right move? Well, like I said, I am not a shareholder, so yes, I do. I can play armchair pundit just as well as all the death-to-Yahoo commenters (who are likely either angry shareholders themselves or just idle bystanders), who are merely counting down the minutes to some spectacular corporate meltdown event that might provide some amusement and water-cooler talk for a few days. But to date, what has happened? Icahn has been checked. Ballmer's cooled off just long enough to pretend like he knows nothing about all that Vista Capable foolishness. Yang is resigning the post he was never supposed to hold or even wanted to hold, BUT is still retaining the spiritual leadership position within the company that he and Filo have always had as its co-founders. Zimbra, Flickr, Yahoo Search, Yahoo Mail, and Babelfish, not to mention a gigashit-ton of other projects and the FreeBSD and linux servers that they run on, etc. etc. etc. are not in Microsoft's hands, awaiting summary extinguishment. Google still has one more competitor pushing them forward. For that matter, so does Microsoft. On the downside, some good people have left the company and other good people have been left by the company. And an even greater number of shareholders are storming the gates with torches and pitchforks. Tough trade to make, but at least they're still standing.

stupid netizens.

[Anonymous Coward]

i dont know this guy. but i like yahoo. their
free online email doesn't suck like hotmail/live sucks.
i'm very sure that if M$ would have acquired Y!
all the online Y! email would start to suck instantly.

i really hope that Y! survives for a long time.
if stocks dive, it just means that nobody wants to
buy those stocks. it doesn't mean the company is bad.
especially if the company doesn't pay dividends. if a company doesn't buy dividends anybody buying into that stocks is not investing -BUT-
GAMBLING!!!

what Y! needs to do is lay-off people, refocus,
and let machines do machine work! i'm hard pressed to suggest to slash 50% of lazy desk toad
"employees" at Y!.

oh, and forget about the board of directors. they're not interested in growing the company,
deep down being super jealous about the success
of some snotty uni-kid that got rich with a good
idea, while the old-toads had to "work" to
become rich. they will do anything to make
the Y! ship sink, e.g. get bought by somebody
and then cashing in! a$$holes!
they still don't understand the internet. internet
companies are not like traditional companies,
and the success potential is still as possible
as it was in the hay days of the internet.
anyone saying that the internet is finish is an
idiot. the next killer-app might just be around
the corner and this is what the Y! ""bored" of
directors" doesn't understand. they are freaking
relics in a new economy. sheesh!

The next level

[ultranova]

a new CEO who can take the company to the next level

But can they find the warp zone ?

Re:The next level

[OneSmartFellow]

Damn, I was going to comment on that phrase too, but your snipe beats the hell out of what I was going to say.

Jerry is too nice to be CEO

[pcause]

I know Jerry and he is smart and insightful, but way too nice to be a CEO in an industry where he has to compete against SOBs like Ballmer and Schmidt. Jerry is polite and considerate. He is thoughtful and modest. The other guys are rude, arrogant, aggressive, nasty folk.

Jerry did a lot of useful changes, but what he didn't get that it is all about perception of being a leader and being on the path upward. A lot of the issue for the market is PR versus reality. And, let face it, search and search advertising are the things the market views as keys to future success and Yahoo has fallen further behind in this area. The decision to outsource search to Google by Yahoo may prove to be one of the top 5 greatest business mistakes of all time and Jerry has to share blame for that as well.

Jerry didn't move boldly enough, but his Board should have known that his base style wouldn't allow it. He should have reorg'ed immediately and publicly, giving folks ownership and accountability. You get the job but you get fired if you don't hit the goals. He let key services stagnate. Yahoo mail took too long to fix their UI to match Google and Yahoo still charges for POP access. Yahoo was the calendar leader, but Google launches a slightly better calendar and is viewed as the leader, even without a customer base. Yahoo Groups is a leader but is old and stale compared to something like Ning. There are lots of examples of how to upgrade their services out there for Yahoo and they seem to ignore them and let others steal mind share and leadership from them.

I fear that it is too late. Yahoo is the AOL of Web 2.0. It is only a matter of time.

Re:Jerry is too nice to be CEO

[elrous0]

I doubt the Chinese journalist now sitting in prison because Yahoo ratted him out to the government would view Jerry as a nice guy.

Re:Jerry is too nice to be CEO

[Anonymous Coward]

You make it sound like Yang personally rang up the Chinese gov with the guy's IP address and said "Here, throw the bitch in jail."

Classy.

Re:I've been cheering his rejection of Microsoft..

[blind biker]

I look at it from the point of view of a Yahoo user (of various services) and I feel it was a great decision. Yahoo isn't going anywhere - they are a PROFITABLE company, even if they don't rake in billions per quarter. a few hundred million bucks is nothing to sneeze at.

Re:I've been cheering his rejection of Microsoft..

[Anonymous Coward]

I believe Kant called this a priori reasoning. We can't really get evidence in the empirical sense, but we can use logic and reason. Microsoft does what it needs to maintain it's monopoly. Any corporation with a monopoly would to what it needs to maintain it. Therefor Apple would as well. It's kinda weak but my point still stands.

Re:I've been cheering his rejection of Microsoft..

[Paradise Pete]

So I hate to be a wet blanket, but do you have any actual legitimate evidence that Apple would be as evil as Microsoft given the same position?

I've been using Macs since 1984, and expect to continue to do so, but if the way they are handling the iPhone app store is any indication, then yeah, I think under the right circumstances they might be Microsoft-esque in their evilness.

Where do these people learn to speak like that ?

[OneSmartFellow]

Chairman Roy Bostock - '... take it to the next level...'

Sounds like something one of the panel might say on "The X-Factor".

I want a Chairman of a Billion dollar corporation to say something a bit more concise, and profound.

Turn it up to 11, man !

Re:I've been cheering his rejection of Microsoft..

[Anonymous Coward]

Same here. I use Google for most everything but I like Yahoo answers and Yahoo avatars. I'd hate to stop using them but I would if MS bought out the company.

Re:I've been cheering his rejection of Microsoft..

[TheRaven64]

Companies continue to exist until they run out of money. Yahoo! made a $92m profit last quarter and they have assets worth over $11bn. They are growing, albeit slowly, so it will be a long time before they go away. They still have a recognisable brand and a lot of customers.

"Chief Yahoo"? Isn't he the guy...

[joedoc]

...who rides out to the middle of Doak Campbell Stadium in the spotted horse and throws the flaming spear into...

Oh, wait, sorry...that's Chief Osceola.

Like anyone on this site would know anything about college football...

Not AGAIN

[ohtani]

UGH! Am I the ONLY one on this planet that sees BEYOND the whole financial benefits of this! I don't care if Yahoo!'s current stocks were $1 and Microsoft was offering $100! If I was Jerry Yang I wouldn't bite on the offer either! The last thing I want to see is Microsoft acquire Yahoo! at all.

If you WANT to see Microsoft acquire them, all you're caring about is the money side of things. That's perhaps the worst reason to have this buyout go through. Jerry is trying to protect his company, damn it.

And I ask you all this: Since when is "offer" defined as "a requirement to oblige"?

Re:Not AGAIN

[danzona]

UGH! Am I the ONLY one on this planet that sees BEYOND the whole financial benefits of this!

No, although you may be the ONLY one on this planet who does not UNDERSTAND what a publicly traded company is.

When Yahoo went public (by selling stock to the public) they no longer own the business outright. The owners (the shareholders) will appoint a board of directors who will act on behalf of the owners (the shareholders) and select executives to run the company on a day to day basis.

Your points are all valid for a privately held company, but the executives of a publicly held company are expected to act in a way that maximizes shareholder value. The Yahoo CEO did not do that, and therefore he is no longer the CEO.

Re:Not AGAIN

[Swampash]

If you WANT to see Microsoft acquire them, all you're caring about is the money side of things.

Seeing as how I am neither employed by or a shareholder in either company, I don't give a shit whether MS buys Yahoo or not. They're both big bloated companies that make a bunch of useless shit that I don't care about.

Re:Not AGAIN

[ohtani]

Fair enough. Makes sense to me that the shareholders have a large say in this, so he needs to be following that. This still doesn't change my opinion that it shouldn't be happening at all. But if it's what they want, it's what they want.

Microsoft would have destroyed Yahoo

[Anonymous Coward]

Not selling Yahoo to Microsoft might have not been the best thing for shareholders, but it was the best thing for Yahoo. Microsoft would have destroyed Yahoo. They've had all these years to come up with a viable competitor to Yahoo and have nothing comparable. That's because Microsoft just doesn't 'get it'.

I originally got my Yahoo email account years ago when Microsoft destroyed Hotmail. Thats all Yahoo mail needs, passport sign in and downtime. Bleh.

Finally, my stocks have crashed recently too, albeit not Yahoo, shall I blame Jerry Yang as well?

Cite, please

[Frankie70]

He failed to act on Yang's and Filo's suggestion that Yahoo acquire Google when that was still possible.

Cite, please.

Larry & Sergei refused to sell Google from what I remember.

Ya...what?

[Anal Surprise]

I'm a former "Yahoo", and I've got to say that I spent much of my time hoping someone would buy the company, if only to mindwipe the boneheaded middle and upper management.

They could've been the AOL in an AOL/Time Warner sandwich — that "gem" that someone else paid too much for.

Now? Forget it. I did.

Yahoo search surrendered the search biz when they agreed to send search marketing results through google. Even with the Department of Justice shooting that down, well, it's a hell of a statement when even your competitor chooses The Other Guy.

Another microsoft masterpiece

[unity100]

they have successfully destabilized and thrown another i.t./internet pioneer company into turmoil. merger talks, hostile acquisition, collaborating with DOJ to get their ad deal investigated (dont tell me they didnt) and etc and voila - another company providing service to people for decades going bust.

when i hear of the word 'microsoft' nowadays, i feel the urge to reach any thick stick nearby. or a baseball bat. or, a stone at least.

Re:Another microsoft masterpiece

[sexconker]

And beat yourself over the head, right?

MS was graciously offering to pay a juicy premium to buy Yahoo. A certain person on the board was a whiny little bitch and didn't want Yahoo to be bought out by MS. MS walked away, investors got pissed, and as a last ditch effort Yahoo went begging to Google.

The deal with Google deal was probably never serious - Yahoo just wanted to get a stock bump from the Google buzz to appease investors while they shuffled the board a bit, and maybe get into a bidding war with MS. Google and Yahoo didn't really try to defend themselves when the deal came under fire for creating a monopoly. Google basically put the brakes on the deal as soon as the DOJ caught wind of it, and never tried to go forward with the deal or defend themselves. Either Google knew this shit would never fly, or they never intended to deal with Yahoo in the first place.

But when Yahoo was sucking Google's cock, MS didn't bat an eye. The whole fiasco will only serve to accelerate Yahoo's death spiral, at which point MS can buy it on the cheap, or possibly even buy it piecemeal.

If MS was actively puppeteering this shit, as you imply, then you have to admit Yahoo and Google completely failed.

I on the other hand, suggest that Yahoo has one foot in the grave, missed a great opportunity with MS, and ran off to Google in desperation. This was pointless because any search deal between the 2 would have been shot down by the DOJ.

I believe we'll see a Yahoo fire sale by February.

Re:Another microsoft masterpiece

[Clandestine_Blaze]

they have successfully destabilized and thrown another i.t./internet pioneer company into turmoil. merger talks, hostile acquisition, collaborating with DOJ to get their ad deal investigated (dont tell me they didnt) and etc and voila - another company providing service to people for decades going bust.

The beauty of what you just said is that there are a lot of shareholders that WANTED the deal to go through with Microsoft despite seeing the dirty, hostile tactics Microsoft undertook to destroy Yahoo.

We've all seen what Microsoft has done with Hotmail, and we know that in the last fifteen years, Microsoft has done very little to bring anything innovative to the Web. So why would shareholders be excited about a deal? A temporary increase in stock price? But when Microsoft guts Yahoo, would the shareholders still smile?

and goods and services bring what, exactly?

[Anonymous Coward]

say it with me now...PROFIT. Without a profit, there would be no goods and no company.

There are organizations that offer goods and services for a non-profit. They are called, get this, non-profit organizations.

Welcome to capitalism.

Re:and goods and services bring what, exactly?

[Martin Soto]

say it with me now...PROFIT.

Nope, I won't say it with you. Goods and services bring well-being. They are the food that you eat, the house you live in, the clothes you wear, and the car you drive. They are the care you receive when you're ill, and the entertainment and culture you enjoy everyday. It is the availability of such goods and services that constitutes wealth, not money, which, in and by itself, is basically worthless.

Without a profit, there would be no goods and no company.

Sure, and that makes sense. But these profits should translate into a real net gain for society, and not simply into an increase in the balance account at the expense of other people's lifes or well-being.

Why aren't Slashdotters checking Google?

[xant]

They did sue. Good thing you thought of it 9 months later, though, right? Maybe you should be Yahoo's CEO.

Jerry Yang's a great guy

[adsl]

We have a lot to thank JY and his co-founder for all that Yahoo has brought to us. But he didn't make a good ceo. He upset Mr Softy, so they took a walk and thought he was getting into a neat relationship with Google. But I think the latter just played along until MS walked, then they dumped Yahoo under the pretence of anti-trust stuff. Google had this excuse up their sleeves to use as soon as MS walked, IMHO. Yahoo needs a ceo who can reawaken MS interest, or a leader who charts a really new innovative course. I wsh all Yahoo the best, it' still my homepage.

Anyone not see this coming?

[Anonymous Coward]

When Carl Icahn invests you listen...or else your shareholders will turn on you and you will be done.

Can't sell advertising

[Animats]

Yahoo's problem is that they can't sell ads. Few companies want to buy ads on #2 or #3 when they're so far behind. That's the killer. Yahoo outsourced most of their ad operation to Google, which, over time, dooms them to irrelevance. Even Google's ad operation is in trouble. Online advertising is flat and has probably peaked. Google is no longer a growth stock.

Once you reach a certain level, search quality doesn't seem to affect market share much. Yahoo's search engine is fairly good. For about half of 2007, it was better than Google's. Yahoo had added all those specialized subengines (weather, stocks, celebrities, etc.) and Google had to catch up, which they did by late 2007. Yahoo's market share did not improve while they were better than Google. Search quality does matter if it's awful (see Cuil and Rushmore Drive), but once over the entry threshold, further improvements don't seem to affect the bottom line much. Advertising targeting matters more.

Yahoo still tries to be a "portal", but does anybody still use Yahoo as a home page other than people who somehow got it installed with their browser and doesn't know how to change? The trouble with "portals" is that the targeting is terrible; when the ads are displayed on the home page, the portal has no idea what the user wants yet.

how do we know MSFT could actually buy YHOO?

[hackingbear]

If the antitrust regulator blocks yahoo-google deal, why would they pass MSFT-YHOO deal? Remember, search is not the only business in the world. Both Microsoft and Yahoo have huge e-mail and portal businesses, while gmail is still trailing much behind; their union will become a monopoly in email service. You know it is harder to change your email address than switching search provider. So why should the same regulator OK that?

Microsoft likely knew that their deal wouldn't go through really. Their action was probably just trying to trash Yahoo.

Re:how do we know MSFT could actually buy YHOO?

[bakuun]

It's not about the email or searching at all. It's about the advertisement - that's where the money is (when did you last pay to search (/email) for something using [microsoft|google|yahoo] search (/email)? And when it comes to online ads, google is quite a bit larger than both ms and yahoo - especially since they got doubleclick.

Re:I've been cheering his rejection of Microsoft..

[elrous0]

That just gave me an idea for a new Apple slogan: "Apple; a stylish, more elegant evil"

no

[unity100]

this is not the first time microsoft pulled some complex shit to get competition or opposition out of the scene.

in 80s, there were innumerable filth that has been perpetrated by them.

we experienced the iso scandal, they bribed a lot of experts in countries to vote for their own standard,

we experienced them paying off officials in numerous african and south american countries to drop open source linux and adopt xp.

do i need to continue ? slashdot is like an annal of microsoft's filth perpetrated through the last 10 years.

hilarious to see that there are still MORONS who are modding down anything criticizing their favorite fanboi corporation tho.

Re:no

[sexconker]

There is absolutely no indication that MS did anything wrong, illegal, or unethical with regards to the Yahoo! fiasco.

There is every indication that the Yahoo! CEO, who is now being forced to step down, made horrible business decisions and let his pride get in the way of what was best for investors, and probably his company as a whole.

MS made a generous offer for Yahoo!.
Yahoo! CEO bitched and whined that MS undervalued them. This is patently bullshit, look at the stock and Yahoo!'s earnings.
MS walked away.
Yahoo! ran to Google.
Let's assume MS bitched to the DOJ.
The DOJ dragged their feet.
Google dragged it's feet, saying "Well, the DOJ might investigate...".
The DOJ decided to investigate.
Google bailed out, saying "The DOJ is investigating!".
MS is no longer interested in offering Yahoo! a similar deal as it had in the past. (See Yahoo!'s stock price.)
Pushing Yang out of the CEO chair (but still keeping him on with a golden parachute...) may be a first step for Yahoo! to try and court MS, Yang-free.
MS, being smart, will wait until Yahoo! is dead, and will pick up the pieces.

It's simply good business. Sorry your favorite players didn't win. Sorry the team you love to hate completely dominated.

Re:no

[Anonymous Coward]

LOL, oh wow.

Re:no

[unity100]

if your definition of 'good business' is this, removing competition by tail maneuvering and deceptive proceedings, without producing ZIT that would benefit the society, the most elaborate, intellectual and well argumentated thing i can say as a response to you is ;screw you;.

people thinking like you are making the world a shitty place to live in.

Re:no

[sexconker]

Awwww.

Re:no

[jt2377]

Are you going to cry? MS did nothing wrong in this MS-Yahoo deal. No amount of crying from you going to prove otherwise. Deal with it!

That is incorrect.

[jotaeleemeese]

Most companies' business plan involves serving their costumers.

If shareholders like the respective business plan then they invest in the company and share the rewards, but the focus of any company should be costumers: they are the people that make the company viable.

Re:That is incorrect.

[abigor]

but the focus of any company should be costumers: they are the people that make the company viable.

True enough, without a steady supply of clown suits, where would most companies be?

You hit the nail in the head.

[jotaeleemeese]

The stock markets are becoming giant government sanctioned casinos were speculators gamble our wealth.

Traders very often look only to graphics identified by stock symbols without bothering to understand the fundamentals of the company behind them, unsurprisingly the system keeps falling under its own weight, but nobody has what it takes (including Mr Obama) to sit down and reflect how to fix the speculative nature of stock markets (hint: if short selling is bad, as seems to be the consensus of many governments, why the simple buying and selling of share with speculative intentions is not equally questionable?).

In normal markets you can also speculate, but unlike stock, in many localities such activity is illegal. But the same activity performed by rich financiers is OK, after all they are bankrolling our politicians.

Re:I've been cheering his rejection of Microsoft..

[666999]

I don't think it can be changed afterward, but when you sign up for a yahoo email account setting your country to Canada and choosing a yahoo.ca or ymail.com address gives you POP access without fees. My yahoo.com address asks for payment to enable this feature.

Re:Something everyone always forgets, or just igno

[Anonymous Coward]

Jews tend to help each other. Terry Semel (a Jew) was instrumental in giving Google (a Jewish company) a helping hand when the latter company was still small and vulnerable. I'm referring, of course, to Yahoo renting Google's first-generation technology, thus giving Google its first huge financial boost. Now Yahoo is in mortal danger from the company it helped, thanks to Semel.

Exactly

[mahadiga]

That's why ESOPs must be compulsorily given to all employees in services industry.

aaaaaaaaah

[unity100]

there are nobody over me with the power to stop me from crying, therefore if i want to cry over anything, i can.

not being an american, i dont have to suffer your society's shortcomings and negative attitude towards emotions and the havoc that wreaks in your psychological health in later stages of your lives.

and in addition, being free to do as such, im NOT dealing with it, and accusing microsoft of wrongdoing in this event.

doesnt need proof tho. they stopped short of a hostile takeover when they calculated that that would shatter their reputation pr wise. microsoft is not denying that. but dimwits like you are.

Yahoo and the next generation

[murdockme]

Am actually glad to see the transition. But one thing Jerry Yang should know and I would ask the next CEO to do (I know I would if the position comes to me) he's not Chief Yahoo anymore. In fact he's not welcome on company property any longer. You step down after driving the company into the ground, you're out. Time for new blood in the chair and at the boardroom table as well. New Board, New Leadership, New ideas, and new gains.

Employees FIRST, then CLIENTs, THEN INVESTORS. Yes it's a public company, but without the employees to run it you're screwed. Without the clients buying the products, you're screwed more, and without the investors to help move things along to support that vision with some cash...you're closed. You can please all of them, but it takes passion and vision. Two things that have been sadly lacking at Yahoo.

I challenge any incoming CEO candidate to match me: http://is.gd/82O7

I am ready to come in and make changes and turn the company around. All I need is the backing of the board and some others out there. Icahn are you reading this? If so...let's talk.

Michael Murdock, CEO
DocMurdock.com
former Apple CEO Candidate 1997

Re:Yahoo and the next generation

[Anonymous Coward]

Hahaha.
AAAAHAHAHAHAHA.

Hey Icahn, are you really reading this?

What Jerry Yang didn't know or do was how to be a Microsoft cock-craving lackey faggot like you and Mr. Industry up there. But that's all I'm about, baby.

I challenge any incoming CEO candidate to match me: http://www.lemonparty.org/

Also, I will keep the corporate brothel stocked with the skankiest manwhores avaliable, or your money back...so let's talk.

Anonymous Coward, CEO
Unlimited Trollworks
Current United States of America President-Elect 2008

Not really.

[Stu Charlton]

Motivations are mixed; owners aren't always looking for a company to enrich them. The Mozilla Corporation, a for-profit entity, for example, is owned by The Mozilla Foundation, a not-for-profit.

Motivations further don't explain the function & purpose of a company, which is ultimately to create and keep a customer, increasing the wealth capacity of the economy in the process.

Remind me not to hire you for steganography

[Mathinker]

I managed to figure out it was there, if only after using sophisticated statistical techniques! LOL

Actually this is the first time that I remember seeing an attempted joke which was actually a "whoosh"... Or maybe my post is a "whoosh"? Was the AC trying to make a joke about how bad his steganograpy is?