Yahoo Wants To Be Google, Tries Not To Be AOL

Yahoo is an interesting entity. It has an enormous Internet presence, of course; 500 million visitors a month. But Yahoo seems like an audience without a show from time to time. Its share price has declined precipitously, losing half its value in the last two years; Google is killing them at Internet search; and social networking sites drag Yahoo's users off to hang out in their virtual worlds. How will Yahoo compete? By laying people off, for starters.

During the weekend, some blogs reported that Yahoo was considering layoffs of 10 to 20 percent of its work force. But the people close to the company, who discussed Yahoo’s layoff plans on condition that they not be identified, said the cuts would most likely be in the hundreds.

The last time Yahoo had sizable layoffs was in 2001, after the dot-com crash. During the last year, the company added several hundred people, some through hiring and some through acquisitions of companies like the online advertising specialists Right Media and BlueLithium and the e-mail provider Zimbra.

Mr. Yang and other Yahoo executives have said recently that they believe that those acquisitions and a series of reorganizations have primed the company for a turnaround. But they have cautioned that financial results may not improve quickly. They have also said they believe Yahoo can succeed as an independent company, amid growing speculation that the company could become a takeover target.

AOL once had an enormous customer base and no idea what to do with them. Unless Yahoo wants to take over the mantle of Internet portal of the nursing home set, it better figure out how to monetize their traffic. Hey, maybe they could buy Time Warner! Sorry, bad idea.  
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