The news that Jerry Yang would be stepping aside as CEO of Yahoo (NSDQ: YHOO) cheered investors, but online ad industry execs aren’t sure much has changed. And while shareholders would be thrilled by a Microsoft (NSDQ: MSFT) takeover, advertisers and publishers can’t tell if that will ultimately prove positive either. In essence, there’s a lot that’s right about Yahoo — a strong consumer brand with popular sites and social net tools — but the company has been so unfocused for so long, no quick turnaround is expected. Some ad industry comments:
— Where it started going wrong: Rob Norman, CEO, GroupM: Yahoo started going awry when it tried to compete head-to-head with the entertainment industry. When Terry Semel, a Warner Bros. exec for over two decades, was brought in back in April 2001, followed three years later with the hiring of former TV exec Lloyd Braun to run the Yahoo Media Group, the company’s perspective started getting muddled…much more in extended entry.
Then, when Dan Rosensweig, former Yahoo COO and currently being mentioned as Yang’s possible successor, and former chief sales officer Wenda Harris Millard, left the company, they took Yahoo’s commercial intelligence with them. Norman: “The zenith of Yahoo’s relationship with advertisers was when Wenda was there. Both she and Dan had highly commercial mindsets and realized the value of the ‘big reach meeting big brand’ concept of Internet ad space. My sense is that Jerry is essentially a technology person, and a brilliant one. He’s a great guiding spirit, and could be a great chairman, but he’s not a Steve Ballmer or Dan Rosensweig or Eric Schmidt. He’s not a great CEO.”
— Yahoo’s value: Norman added that from an ad industry standpoint, Yahoo is still highly relevant to marketers and agencies by dint of its enormous reach. Yahoo has more e-mail accounts than everyone else, more impressions, more photos uploaded on Flickr, and therefore reports of its death are grossly premature. “My sense is that a new CEO can connect with advertisers and connect its product strategy.”
— Leadership vacuum: One online publisher, who didn’t want to be identified, agreed with Norman that Yahoo has enormous reach, but questioned its value. “Yahoo mail is not going to do squat for you as an advertiser. Yahoo News and other parts of the portal are interesting properties, but the leadership vacuum — which existed long before Jerry — could never figure out what Yahoo was at its core. Is Yahoo a bunch of disparate items cobbled together within an ad network model? Maybe. But how far can you take that? Whoever ends up there, it’s not going to be a quick fix. From a company strategy perspective, they’re built the same way today as they were five years ago. The next CEO will have to take it apart and put it back together.” More after the jump
— The Microsoft option: While most of the execs I spoke to say that a Microsoft takeover would be the best thing for the Yahoo shareholders, at least initially, that company wouldn’t necessarily be able to fix what’s wrong either. “Microsoft’s own content play is a disaster and a mess,” the web publishing exec said. “MSN, because it’s a portal, often is compared to Yahoo. MSN hasn’t been able to do well at things Yahoo has been able to do well, such as creating the Yahoo Newspaper Consortium.” As for what Yahoo should be looking for in a replacement for Yang, Bryan Wiener, CEO of interactive ad shop 360i, says a fresh face would help temporarily energize Yahoo