Om Malik is not impressed by the way the Yahoo Board has dealt so far with the Microsoft bid.
What has taken them so long? Nearly a week has passed since Yahoo received an unsolicited offer of $44.5 billion from Microsoft.
Since then everyone — including Google — has had his or her say on the deal. The only group that has been silent on the topic – Yahoo’s board of directors -– is the one that really matters. Reuters is running a long piece on Yahoo’s board and its role in this merger. It is a bit of PR puffery; it tries to position the board as key players in the deal, and notes how they need to deliberate everything in order to get it right.
Malik believes that the Microsoft offer is a great deal (in financial terms) and I agree with that. Nobody in their right mind wold pay a premium for Yahoo in its present state. So he thinks the Board should just bite the bullet and take the cash.
While it is easy to blame the management, Yahoo’s board of directors can’t duck the blame. It was on their watch that a culture of mediocrity enveloped this once-iconic company. The board, instead of being proactive, sat idly by as the company lost its direction, focus and eventually, its market leadership.
If Wall Street and the media were aware of Terry Semel’s rumored lack of interest in the job, why wasn’t the board aware of it? Instead they decided to reward him with $71 million, much to the chagrin of the investors, before showing him the door. As one talented executive (and engineer) after another left the company, looking to go chase opportunities at either Google or with other Silicon Valley startups, what, exactly, was Yahoo’s board doing?
Where was the board when the company was making one strategic blunder after another -– losing its technology focus and instead chasing the ephemeral opportunities in la-la land? Where were they when politics and bureaucracy started to eat at Yahoo’s insides?
Whatever spin you might read in the news media about Yahoo’s board, simply put, they have failed in their duties.
Good stuff. I see an intriguing parallel between what happened to Yahoo and what happened to Apple after Steve Jobs was fired. Terry Semel plays the role of John Sculley in that analogy. The problem is that there was no Steve Jobs to return to turn Yahoo away from its corporate torpor. And, in any event, there’s less of a possibility of a charismatic individual being able to do that in a non-hardware company anyway.