Faced with dwindling revenues and an inability to compete with Google, Yahoo is preparing to lay off between 600 and 700 workers, possibly before Christmas, possibly as early as today. Most of the cuts will occur in Sunnyvale’s products unit, which creates consumer and advertising services.Andrew Ross Sorkin reports that CEO Carole Bartz is already on the chopping block. She “has no more than a year,” he writes, “before she must shake up Yahoo or lose her job.” The anticipated shake-up being suggested is that Yahoo sell off its assets in Japan and China, and use the funds to reinvent itself in a Web 2.0 world.
While Yahoo has shown earnings over the past six quarters, this is largely due to layoffs as the company streamlined itself. Bartz, who is reluctant to sell off the company’s Asian assets, has no choice but to follow that route once again to ensure future earnings.
Among the people most frustrated with Yahoo’s performance is Japanese billionaire Masayoshi Son, CEO of Softbank, which owns a significant share of Yahoo. He had high praise for Yahoo founder Jerry Yang, but decried the direction the company has taken over the past few years. He is especially upset about Yahoo’s attempt to rebrand itself as a media company, at the expense of technological innovation. “Unfortunately, some of the key executives after the foundation of the company couldn’t keep up with the technology innovation of the industry,” said Son.
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