Tuesday, June 19, 2007

The Guardian: Founder Yang takes over after Semel quits

From tomorrow's Guardian:

Bobbie Johnson, technology correspondent
Wednesday June 20, 2007
The Guardian

Investors and analysts backed the surprise departure of Yahoo!'s chief executive, Terry Semel, yesterday but gave a mixed response to news of his successor.

Mr Semel announced late on Monday that he was stepping down after six years in the job, after mounting pressure in recent months. In a letter to the board, Mr Semel admitted that "none of us is at all satisfied with the company's recent financial performance" and that he had decided the time was right to step aside.

He will remain on the board as non-executive chairman but has been replaced by Jerry Yang, who started Yahoo! with his fellow college dropout David Filo in 1995. Mr Yang, 38, said that it was "a great honour" to be taking the position, while admitting that the past year had "obviously not been an easy one for us".

But the decision to appoint him to the top job received a lukewarm response from investors and analysts. Some said they doubted whether he had the experience or new ideas to revive the company.

"We would have liked to see a more radical departure from the past but Yang clearly thinks he can turn this thing around," said Ben Schacter of UBS.

The reshuffle also moves the fast-rising executive Susan Decker into a more influential position. Ms Decker, a former Yahoo! chief financial officer who was recently promoted to head of advertising, was widely seen as Mr Semel's successor but will become company president.

Eric Jackson, leader of a group of small shareholder activists, said: "Mr Semel brought much-needed stability to Yahoo! in the early days but we weren't the only ones who were critical over the past three years. I don't agree that Jerry Yang is a stopgap or that he's inexperienced - in the technology industry the founders of any company cast a major shadow."

Mr Semel, a New Yorker who was chairman and chief executive of the Warner Bros studio, was seen as an outsider when he took over at the pioneering dotcom company in 2001. He quickly set about trying to turn Yahoo! into a global media company and under his charge the company expanded from 3,500 staff to 12,000.

However, a series of mis-steps in recent years has seen the share price fall and his fate was sealed by the stifled launch of the much-heralded Panama advertising system last year. Touted as a competitor to Google's immensely successful advertising scheme, Panama was met with muted enthusiasm, putting Mr Semel's position into question among investors.

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