SUNNYVALE, Calif. — Yahoo has gone through three chief executives in five years. Whoever takes the helm now will face the same challenge: Solve one of the Internet’s most perplexing puzzles.
Why is a company that owns some of the world’s most widely used online services unable to gain traction among Web surfers, advertisers and investors? Can the company that rode the Internet boom ever again be where the cool kids go? Unless Yahoo’s next regime can figure it out, the company is in danger of becoming an Internet anachronism that might have to be broken up to be salvaged.
The challenge confounded Silicon Valley veteran Carol Bartz, who spent more than 2 1/2 years retooling Yahoo before being fired over the phone late Tuesday.
It also befuddled Yahoo chairman Roy Bostock, who embraced Bartz as the “exact combination” of experience and savvy the company needed when she was hired in January 2009.
As a stopgap measure, Yahoo appointed chief financial officer Tim Morse to be interim leader until the company’s board can hire a permanent replacement. Morse, 42, met with Yahoo’s employees at the company’s headquarters Wednesday.
The board hasn’t set a timetable for finding the next CEO. The directors took two months to hire Bartz after co-founder Jerry Yang decided he wanted to end a 1 1/2-year stint as CEO in 2008.
Yahoo rode the Internet boom of the 1990s and weathered the dot-com bust that followed. In the past decade, says Forrester Research analyst Shar VanBoskirk, the company has spent too much time clinging to its early success in the 1990s, instead of adapting to trends that have reshaped the Internet.
Two companies that helped drive the changes, Internet search leader Google and social network Facebook, are now the places where the cool kids hang out and, more important to investors, where advertisers increasingly spend their money.
“Yahoo has become a business stuck in its glory days,” VanBoskirk says.
