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What Went Wrong With Yahoo?

Aug 3, 2016

Yahoo! was once an almost $125 billion fortune, which sold at $5 billion to Verizon.

It was once as big as Google or Facebook are today. How did an information giant crumble so badly in the information age? What were decisions that led to its ultimate irrelevancy and loss of power?

yahoo image

  • Yahoo failed to promote executives within the company and got people from outside the company. People inside the company obviously did not like this. When people are not appreciated well for the work, they lose interest in working as well
  • No work from home culture: Yes, free food was provided and this was done with a clear motive of making people work, but this initiative was heavily criticized within and outside the company.

Mark Zuckerberg turned down Facebook acquisition by Yahoo!? : All Yahoo! had to do then was acquire Myspace which was dominating the social media then and rule the social media. Yahoo! could have made a good bid on Orkut as well.

Failure to focus: Yahoo! had so many products that the company lost its focus. It was hard to decide what they had to focus on. They fell into the constant state of debate of:

  • Whether to improve current products
  • Or innovate

Jack of all trades: Yes, Yahoo! was everywhere. Search, mail, messenger, finance, news, sports, entertainment, etc. They were in top 10 always- Yes! But did it lead in any of them? No!


Acquiring was the end game: Yahoo! acquired many companies, but did not do anything with it. Flickr easily had over billion posts and had so many active users. But Yahoo! played no role in improving it.


Let the best products die: Some of best and people’s favorite Yahoo! products died

  • Yahoo! Messenger
  • Yahoo Answers could have been a game changer - Well, you are reading my answer on Quora, so this explains what Yahoo Answers could have been
  • Yahoo videos could not take over giants like Youtube and gave up on improvising very quickly

Not being in the present: This is the era of artificial intelligence and smart computers. But Yahoo! failed to compete with leading industries like Google, Apple(Siri) and facebook

But, it is a sad state to see once a dominating leader be acquired at such a low price!

This question originally appeared on Quora: What went wrong with Yahoo (2016)? Answer by JHarshitha Chidanand, Masters in Computer Science and Technology Management.

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