For those keeping track at home, Microsoft was offering $31 a share at the time, which valued Yahoo at over $44-billion. Yahoo’s current market capitalization is less than $15-billion, which means almost $30-billion or about 65 per cent of the company’s value has vanished. Obviously, all of that decline can’t be blamed on Jerry, since the global economic meltdown probably had a little to do with it as well. But even before that happened, Yahoo’s stock value had dropped by tens of billions of dollars. About all Jerry and the board could come up with as a strategy was to float a merger deal of some kind with AOL of all places.
Lots of people have risen to Yang’s defence amid the criticisms of the past few months, and the calls for his ouster, but they have likely been motivated more by sympathy — or sheer contrariness — than by any admiration for what he has been able to accomplish at Yahoo, which is virtually nil. Yes, he was the co-founder of the company, and I’m sure he’s a tremendously nice fellow with all sorts of charming personal qualities. That doesn’t mean he’s the right guy to run Yahoo. Steve Ballmer isn’t going to win any charm awards, but he’s arguably done a better job at Microsoft than Yang has done with Yahoo. It’s not a popularity contest.
The biggest problem for the board and for Yahoo now is that Jerry’s departure will make it even more obvious how little strategic direction or bench strength they have at the company, and how rudderless the ship really is. They had better hope that Microsoft isn’t serious when it keeps saying it isn’t interested in a search deal, because that’s about all there is on the table that could make a difference for Yahoo at this point.