Posted December 15, 2010 3:09 am by with 6 comments

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Yahoo continues to be in the news for all the wrong reasons. Yesterday the Internet company (how do you even classify them anymore?) gave pink slips to 4% of their workforce. Yahoo wants to give the impression of a company that is rising from the ashes but it still looks like one that continues to burn to the ground.

TechCrunch reports Yahoo’s response about the reports

Today’s personnel changes are part of our ongoing strategy to best position Yahoo! for revenue growth and margin expansion and to support our strategy to deliver differentiated products to the marketplace. We’ll continue to hire on a global basis to support our key priorities.

Yahoo! is grateful for the important contributions made by the employees affected by this reduction. We are offering severance packages and outplacement services to these employees.

The reports are that the packages were generous but that’s little consolation to those who are now without a job for the Christmas season.

Ever since Carol Bartz has been at the helm the only truly definitive actions that seem to be taken involve cutting expenses. There seems to be little direction for the floundering company. One day it’s about search then the next it’s about content then it’s about (fill in the blank).

Another TechCrunch post gives some insider information about just how bad things are at Yahoo. This comes from one of the victim of the layoff.

The atmosphere here has never been worse. I have heard of dozens of current employee\’s who have provided years of service who were recently asked by their managers if they wanted to be voluntarily let go in order to save someone elses job…I expect hundreds of Yahoo\’s who will be collecting lucrative severance packages in addition to having had months to secure new jobs for themselves in 2011….Lucky me l get to enjoy an extravagant 6 week vacation abroad on Yahoo\’s dime starting just before xmas. I\’ve already booked travel and am actually going to be meeting up with several other employees who also did essentially the same as me… I have worked here for 5 years and I can say without question I have never seen this place in such shambles.

Yahoo is in a rut and it seems like one that it may never truly get out of. As the rest of the bigger names move forward to claim their portion of the Internet pie Yahoo remains mired in doubt. They have even been passed by so many newcomers in the space that one has to wonder if this company has any chance at all to succeed in the new Internet world.

Maybe Yahoo has an idea of where they are headed but the rest of us are having a tough time seeing it. It wasn’t until recently that Carol Bartz herself could articulate just what Yahoo does! As a result, there seems to be little momentum around the company from industry insiders and though there is still plenty of traffic going through Yahoo properties they feel like an old horse being put out to pasture.

Maybe the 400 or so folks who were let go will look back on this as a blessing as they land in other more dynamic places that appear to be moving forward rather than just trying to stay alive.

Considering what they are facing at this time of year one can only hope for something better than what they were released from.

  • Ray

    That’s not a good thing for employees during the holiday season.

    I’ve been let go in the past and it’s almost always a sign of a sinking ship. My approach is that you don’t trust a a ship that springs a leak. Losing 4% is a pretty big leak. Stick a fork in them, they’re done.

  • yahoo always seems to be playing catchup with google, maybe microsoft should just buy them and be done with it

  • I’m sure a large part of the 400 employee layoff was their customer support staff that lost their jobs to MSN AdCenter employees. If that is the case they had to have seen it coming because of the Yahoo/Bing merge. I wish that Microsoft would hire those people because the AdCenter customer support is TERRIBLE in comparison to what Yahoo’s was.

    Google does smart business. Because they hire so many 1099 independent contractors they don’t have to tell the world when they let one go. Publicly traded companies are only obligated to make inhouse layoffs public info. If they outsource something to someone else, that can be kept confidential.

    Yahoo was SOOOO stupid to layoff right before Christmas. Who does that? Only companies that are in severe, panic mode.

    • I suspect it has to do with what can or can’t be written off in 2010. No matter what the reason though it’s a tough move and one that looks harsh considering the current economy and Yahoo’s borderline incompetence as of late.

  • DramaQueen

    Frank, you’re always so overly dramatic about Yahoo.

    Unfortunately, when you’re a public company and you need to meet quarterly goals for your investors in a downed economy, head count is the first to go.

    But keep in mind Yahoo is still profitable with lots of cash and Bartz has new management underneath her now (Blake Irving, Ross Levinsohn, etc).

    Go out and get a new tv with Yahoo’s internet widgets and relax. It will work itself out. 🙂

    • LOL – That was funny. No need being overly dramatic about a company that literally has a tough time describing itself. There have been plenty of businesses who have burned through cash because of lack of focus and direction. Yahoo is poised for some Humpty-Dumpty action. If I’m wrong well then I’m wrong.

      In the meantime – “What light beyond yonder window breaks!!!!!!” Cue the music! Spotlight please!