Yahoo! Reorg

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In a move reminiscent of Microsoft’s late ’05 reorg, Yahoo! has reorganized into three units:

Under the plan, Yahoo will reorganize itself into three operating units, including one focused on its audience and one on its advertisers and publishers. A third unit, focused on technology, will develop products serving the entire organization. (NY Times.)

Yahoo! was getting beaten up the media for being too slow, disorganized and bureaucratic. There’s some truth in some of those criticisms but the problems were undoubtedly not as great as the stories portrayed. Nonetheless all the bad PR helped fuel a cycle of perception-into-reality that forced such a move.

Lloyd Braun’s departure makes sense given the company’s reduced original content ambitions, which were scaled back from the time that Braun joined Yahoo! Daniel L. Rosensweig, COO, may have been justly ousted (given some of the operational critiques that emerged about the company) but he may also be the “Don Rumsfeld” of the deal here (not the Rumsfeld was unjustly booted.)

How much did “Peanut Butter” factor into this? I’d argue it was the PR straw that broke the camel’s back and “bookends” a particularly hard period of negative coverage, disappointing earnings and unusual public speculation and scrutiny of the company.

Whether Yahoo! will become more “nimble” and “accountable” as a result of these moves remains to be seen of course. But internal and external pressures were demanding something bold and decisive.

I sat in on the Panama presentation Yahoo! gave at an SES lunch today and I must say (again) that it’s an impressive platform and should improve the company’s search performance as well as providing advertisers with a richer, better platform.

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Here’s the official Yahoo! release. And here’s Riva Richmond’s article in the WSJ (sub req’d). Here’s an organizational Wiki showing the new structure.

Here’s a very interesting “day two” post from Om Malik on the reorg.

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2 Responses to “Yahoo! Reorg”

  1. Chad Says:

    When I read the release, and Terry Semel’s blog post, I thought not of a similarity to MSN’s re-org, but rather to the AOL re-org a couple years back which, among other elements, formed the Audience group, akin to Y! new audience group. Additionally, at that time they formeda separate Technology organization with a charter not just to develop products and platforms for AOL, but for the Web at large. While I by no means want to stand up and overly laud AOL, the truth is (IMHO) is that this move by AOL in ’04 was the most instrumental move in enabling the most recent move to a true Audience based business. Personally, I think that the assets that Y! brings to bear are stronger than those of AOL, but we need to give credit where credit is due…

  2. Bronte Media » Yahoo Doesn’t Need Another Person Telling it What To Do Says:

    [...] First, as context I tend to agree with Greg – it feels a lot like MSN late last year, or even in 04. They need to stop the rot. Losing page views in categories like Finance and of course market share in search is a lot more important than not integrating Flickr into Yahoo Photos. [...]

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