Yahoo
.svg) Logo used since September 23, 2019 | |
| Company type | Subsidiary |
|---|---|
Website type | Web portal and online services |
| Founded | January 1994 |
| Headquarters | , United States |
| Area served | Worldwide |
| Owners |
|
| Founders | |
| Products | List of products |
| Revenue | $7.4 billion (2020)[1] |
| Employees | 8,600 (2017)[2] |
| Parent |
|
| Website | www |
| Advertising | Yahoo Ad Tech[3] |
| Registration | Optional |
| Current status | Active |
Yahoo (/ˈjɑːhuː/ ⓘ)[4] is an American web portal based in Sunnyvale, California. It provides the search engine Yahoo Search and related services including My Yahoo, Yahoo Mail, Yahoo News, Yahoo Finance, Yahoo Sports, y!entertainment, yahoo!life,[5] and its advertising platform, Yahoo Native. It is operated by the namesake company Yahoo! Inc., which is 90% owned by Apollo Global Management and 10% by Verizon.
Yahoo was established by Jerry Yang and David Filo in January 1994 and was one of the pioneers of the early Internet era in the 1990s.[6] However, its use declined in the 2010s as some of its services were discontinued, and it lost market share to Facebook and Google.[7][8]
Etymology
The word "yahoo" is a backronym for "Yet another Hierarchically Organized Oracle"[9] or "Yet Another Hierarchical Officious Oracle".[10] The term "hierarchical" described how the Yahoo database was arranged in layers of subcategories. The term "oracle" was intended to mean "source of truth and wisdom", and the term "officious", rather than being related to the word's normal meaning, described the many office workers who would use the Yahoo database while surfing from work.[11] However, founders Filo and Yang insist they mainly selected the name because they liked the slang definition of a "yahoo" (used by college students in David Filo's native Louisiana in the late 1980s and early 1990s to refer to an unsophisticated, rural Southerner): "rude, unsophisticated, uncouth."[12] This meaning derives from the Yahoo race of fictional beings from Gulliver's Travels.
History
Founding
In January 1994, Jerry Yang and David Filo were electrical engineering graduate students at Stanford University, where they created a website named "Jerry and David's guide to the World Wide Web".[13][14][15][16] The site was a human-edited web directory, organized in a hierarchy, as opposed to a searchable index of pages. In March 1994, "Jerry and David's Guide to the World Wide Web" was renamed "Yahoo!" and became known as the Yahoo Directory.[14][17][18][19][20] The "yahoo.com" domain was registered on January 18, 1995.[21]
Yahoo was incorporated on March 2, 1995. In 1995, a search engine function, called Yahoo Search, was introduced. This allowed users to search Yahoo Directory.[22][23] Yahoo soon became the first popular online directory and search engine on the World Wide Web.[24]
Expansion and the dot-com bubble
Throughout the 1990s, Yahoo grew rapidly and became a public company via an initial public offering in April 1996 and its stock price rose 600% within two years.[25] Like many search engines and web directories, Yahoo added a web portal, pitching itself against Excite, Lycos, and America Online.[26] By 1998, Yahoo was the most popular starting point for web users,[27] and the human-edited Yahoo Directory the most popular search engine,[19] receiving 95 million page views per day, triple that of rival Excite.[25] It also made many high-profile acquisitions. Yahoo began offering free e-mail from October 1997 after the acquisition of RocketMail, which was then renamed Yahoo Mail.[28] In 1998, Yahoo replaced AltaVista as the crawler-based search engine underlying the Directory with Inktomi.[29] Yahoo's two biggest acquisitions were made in 1999: Geocities for $3.6 billion[30] and Broadcast.com for $5.7 billion.[31]
Its stock price skyrocketed during the dot-com bubble, closing at an all-time high of $118.75 per share on January 3, 2000 and bottomed out at $8.11 on September 26, 2001.[32]
Leadership
Yahoo's corporate direction was heavily influenced by a series of leadership changes and missed opportunities. The company had two failed attempts to acquire Google; in 1998, Larry Page and Sergey Brin approached Yahoo to sell their nascent search engine for $1 million, but Yahoo declined the offer.[33][34] In 2002, CEO Terry Semel entered into negotiations to purchase Google for a reported $5 billion. After weeks of negotiation, Yahoo's final offer was $3 billion, a figure that Google's leadership rejected.[33] The failure to acquire Google in this second instance is widely considered one of the largest strategic errors in corporate history.[35]
In February 2008, Microsoft made an unsolicited bid to acquire Yahoo for $44.6 billion.[36][37] Yahoo rejected the bid, claiming that it "substantially undervalues" the company and was not in the interest of its shareholders. Although Microsoft increased its bid to $47 billion, Yahoo insisted on another 10%+ increase to the offer and Microsoft cancelled the offer in May 2008.[38][39][40][41]
The company subsequently cycled through several chief executives. Carol Bartz, formerly the CEO of Autodesk, replaced Yang as CEO in January 2009.[42][43] After failing to meet performance targets, she was fired by chairman Roy J. Bostock in September 2011, and CFO Tim Morse was named as interim CEO.[44][45] Following the appointment of Scott Thompson as CEO in April 2012, several key executives, including chief product officer Blake Irving, resigned.[46][47] On April 4, Yahoo announced 2,000 layoffs,[48] or about 14% of its 14,100 workers by the end of year, expected to save around $375 million annually.[49] In an email sent to employees that April, Thompson reiterated his view that customers should come first and completely reorganized the company.[50]
Thompson's tenure proved brief; he was fired on May 13, 2012, and replaced on an interim basis by Ross Levinsohn, who himself had recently been appointed head of Yahoo's new Media group. Several associates of Third Point Management, including Daniel S. Loeb, were also nominated to the board of directors.[51][50][52][53] Thompson's total compensation for his 130-day tenure with Yahoo was at least $7.3 million.[54] On July 15, 2012, Marissa Mayer was appointed president and CEO of Yahoo, effective July 17.[55][56] Under Mayer's leadership, doubts about the company's turnaround emerged by January 2014 when she fired her own first major hire, Henrique de Castro.[57]
Business
During the 2000s and 2010s, Yahoo continuously adapted its products and services to keep pace with shifting internet trends. Yahoo began using Google for search in June 2000,[58][59] but over the next four years, it developed its own search technologies. It began using these in 2004, partly incorporating technology from its $280 million acquisition of Inktomi in 2002.[60] In response to Google's Gmail, Yahoo began to offer unlimited email storage in 2007, though it struggled with competition and laid off hundreds of people in 2008.[61]
The company's product strategy frequently experienced turbulence. In August 2010, Yahoo! Groups rolled out a major software change that was denounced by a vast majority of users,[62] prompting vice president Jim Stoneham to announce on September 29 that the site would roll back the changes based on member feedback.[63] Despite these setbacks, Yahoo achieved a brief traffic milestone in July 2013 when comScore data revealed that more people in the U.S. visited Yahoo websites than Google—the first time Yahoo had outperformed Google since 2011.[64] This data did not count mobile usage or Tumblr,[65] the blogging platform Yahoo had acquired in June 2013 for $1.1 billion in cash.[66]