EightBlack.

Remember the opening of Jerry McGuire - where little Tom is furiously writing away in his hotel room the words that are going to revolutionise his company. He then runs down to Kinkos and makes copies for everyone, delighted with his efforts.

Reality then bites him in the arse and his friend promptly fires him over lunch.

Big companies tend not to like evangelists.

Yahoo! had its own religious experience this week with one of their Senior Vice Presidents - Brad Carlinghouse. But then again, everyone who works for a US company is a SVP so how high up the food chain is anyone’s guess. He sounds important enough, so that’s probably good enough.

The story broke a few days ago. In the WSJ and then through the blogosphere.

You can read it here.

I think Yahoo! have serious problems that are way deeper than a slightly teary eyed employee doing “a Jerry” on them.

There’s a little thing called “Panama” that they are grappling with. Panama is Yahoo!’s equivalent to Google’s monolithic Adwords program.

Yahoo! have lost their way. They’re not making deals, they can’t attract talent, and more importantly, they haven’t been able to combat their largest competitor’s revenue model. Morale is in the toilet and people prefer to stay home than come to work. And this is supposed to be one of the hottest companies on earth.
It’s one thing to brag about being the number one site on the internet. It’s entirely another thing if that traffic won’t convert. More importantly, if advertisers dont think you’re innovating, then trouble is on the horizon.

In Australia, Google’s headcount is around the 85 mark and growing rapidly. About 80 people in Sydney (60 engineers, 20 sales and marketing) and 3 in Melbourne. There’s no shortage of people wanting to work for the search giant. I mean, who wouldn’t.

On the other hand. Yahoo! lost one of their best leaders recently, Mel Bohse. Mel was a consummate professional. They then lost Dean Capabianco, their head of sales to NineMSN. And they continue to lose people at a rate of knots.

The cynics might argue that Yahoo! dont have anything to worry about. The company’s revenue streams are still in excess of US$5 billion, they made last year around the US$1.8 billion, market cap is $36 billion. They’ve got cash in the back.

Problem is the company is a rudderless ship. It’s clear the current leaders need to go. In the world of Web 2.0, it’s not enough to have solid financials. Innovation and talent is what the market is craving for.

I hope Yahoo! take notice of the memo that their Senior VP went to thr trouble of writing. On the other hand, Google should just offer him a job.

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This entry was posted on Tuesday, November 21st, 2006 at 7:30 am and is filed under News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.