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Yahoo! Businesses The Internet

Yahoo To Spin Off Everything That Makes It Yahoo (nytimes.com) 210

An anonymous reader writes: Yahoo has confirmed reports from last week by saying it plans to spin off all of its assets aside from its $31 billion stake in Chinese e-commerce company Alibaba. "In the reverse spin off, Yahoo's assets and liabilities other than the Alibaba stake would be transferred to a newly formed company, the stock of which would be distributed pro rata to Yahoo shareholders resulting in two separate publicly-traded companies." Their decision was spurred by how stock market traders were weighing the tax risk of spinning off the most valuable part of the company.

The article notes that this probably means trouble for CEO Marissa Mayer: "Ms. Mayer, who was hired in 2012 to turn around Yahoo, had planned to spin off the company's 15 percent stake in Alibaba, bundled with a small-business services unit, into a new company called Aabaco. She then planned to focus on improving the company's core business, the sale of advertising that is shown to the roughly one billion users of Yahoo's apps and websites. Ms. Mayer is now effectively back to square one. Yahoo's core Internet operations are struggling, even though the chief executive has made dozens of acquisitions, added original video and magazine-style content, and released new apps."

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Yahoo To Spin Off Everything That Makes It Yahoo

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  • by xxxJonBoyxxx ( 565205 ) on Wednesday December 09, 2015 @10:51AM (#51088053)

    So, new CEO from Google comes in, sucks up a huge salary, drives Yahoo further into the ground, and is still there after almost four years. Does anyone else think that "Ms. Mayer" may have been planted at Yahoo to keep the old Internet giant from 1) threatening Google in any meaningful way 2) keep Yahoo out of the hands of Microsoft (remember that?) and 3) keep Yahoo large enough to keep Google out of antitrust trouble (here in the states anyway)? [/conspiracy]

    • Re: (Score:2, Insightful)

      by Anonymous Coward

      No. Only an unthinking paranoid moron would think that. The rest of us will just see this is as normal business SNAFU.

    • That would be a great theory if, post-1999, Yahoo actually had the ability to threaten Google in any way.
      • I look at it the way that Microsoft threw Apple a $150M bone (http://www.cnet.com/news/microsoft-to-invest-150-million-in-apple/) to stave off antitrust action.

      • Actually last numbers I saw had Yahoo mail beating Google mail by a pretty large margin, sadly only stats I can find not behind a paywall are for cellphone usage and naturally that is controlled by Gmail and Safari.
    • You could make the popcorn device in Real Genius with all the TinFoil that you wear with that theory...
      • CEO's don't make companies. They are pseudo-celebrities who generally know nothing other than how to liquidate or bump up the stock . Reality is bitter
    • by DarkOx ( 621550 ) on Wednesday December 09, 2015 @11:05AM (#51088141) Journal

      In fairness she is probably on the right track.

      Their balance sheet isn't all that bad. Probably the thing to do was and still is turn it into an investment house. By that I don't mean the lets buy and re-brand start-ups kind of investment, I mean the Berkshire Hathaway type of operation.

      A lot of people suggested Microsoft should go in that direction around 1999-2001 or so. Frankly in terms of maximizing shareholder value they were probably correct. MS had really lost its way there for awhile. Shortly after they got some focus back and started producing 'quality' well marketable software again. Here we are in 2015 and I kinda think they are headed back off the deep end trying to change the revenue model for Windows and Office and continuing to muck around in the mobile space where they are simply to late to the party. MS has remembered where their bread is buttered before and probably will again.

      Yahoo I am way less optimistic. In terms of technology, they have produced a gem or two along the way like 'web pipes' I think called it? Most of those never really took off though. In terms of their technology being relevant in the market place they have been floundering since before Google showed up. With the resources they have handy they could probably print money if they had a plan and drove some cool products, but they don't seem to have a technology plan. So this move probably is the best option.

      • by lucm ( 889690 ) on Wednesday December 09, 2015 @11:42AM (#51088367)

        MS had really lost its way there for awhile. Shortly after they got some focus back and started producing 'quality' well marketable software again. Here we are in 2015 and I kinda think they are headed back off the deep end trying to change the revenue model for Windows and Office and continuing to muck around in the mobile space where they are simply to late to the party. MS has remembered where their bread is buttered before and probably will again.

        Microsoft is selling more tablets than Apple, making more money than Amazon in the cloud business, and based on market cap is the 3rd biggest company in America (after Apple and Exxon). Microsoft is bigger than Berkshire-Hathaway, bigger than Wells Fargo, than JP Morgan. Twice the size of Coca-Cola, Chevron or Verizon. I don't think they need the advice of some dude in the peanuts gallery as to how they should manage their business.

        • So how's that:

          - $8 billion purchase on Skype
          - $7.2 billion on Nokia
          - $2.5 billion on Minecraft
          - $2 billion investment into Xbox

          working out for them?

        • by dAzED1 ( 33635 )
          "making more money than Amazon in the cloud business" - you clearly don't know where AWS came from. They already had that infrastructure in-house for their own stuff, and just decided to make it cheaper for themselves and make a bit of money off the engineering effort. IE, if you're going to figure out how much they're "making" you need to also figure out how much they're saving. There's not much to Azure, and for a large part it's actually just MS cannibalizing itself. AWS was a completely new market
        • by jcr ( 53032 )

          Microsoft is selling more tablets than Apple

          The bullshit meter just bent the needle. On what do you base this claim?

          -jcr

      • > MS had really lost its way there for awhile.

        And they've found it now ??

        LOL

        The UI clusterfuck of Windows 8 proves that they still don't have a clue.

        As I mentioned [slashdot.org]

        So how's that:

        - $8 billion purchase on Skype
        - $7.2 billion on Nokia
        - $2.5 billion on Minecraft
        - $2 billion investment into Xbox

        working out for them?

        • by jcr ( 53032 )

          The UI clusterfuck of Windows 8 proves that they still don't have a clue. ...and all previous versions of Windows prove that they never had one in the first place.

          -jcr

    • by SecurityGuy ( 217807 ) on Wednesday December 09, 2015 @11:08AM (#51088147)

      Yahoo was already dying. Nobody needed to do anything to drive it into the ground. For years people have been saying the best thing about Yahoo is that it owns a chunk of another company. I think Marissa Meyer was probably looking at no possibility of taking the helm at Google, through no fault of her own, so looked elsewhere. She got a chance to try to turn it around and a pile of money if it didn't work. I don't think we need a conspiracy to explain it.

      • But she got rid of all those unproductive work-at-home employees! Surely that would have turned them around!

        • But she got rid of all those unproductive work-at-home employees! Surely that would have turned them around!

          As from the many internal communications that came out of many Yahoo employees' mouths, she did the right call with this one.

    • by gstoddart ( 321705 ) on Wednesday December 09, 2015 @11:20AM (#51088219) Homepage

      So, new CEO from Google comes in, sucks up a huge salary, drives Yahoo further into the ground, and is still there after almost four years.

      Welcome to the world of CEOs, where competence and results have nothing at all to do with how much damned money you get paid.

      I don't think she's a plant, I think Yahoo was a company which was far too screwed to readily turn itself around, and they've utterly failed to do it.

      Inability of a CEO to turn around a company which has been floundering and lurching around for years doesn't necessitate a conspiracy. I think it points to the fact that people act like CEOs have any actual idea of what they're doing.

      I mean, I can incompetently manage Yahoo for half the money.

      • > I think Yahoo was a company which was far too screwed to readily turn itself around

        Agreed. /oblg. Yahoo vs Google homepage history [imgur.com]

      • by g01d4 ( 888748 )

        CEOs have any actual idea of what they're doing

        I think in most cases they're glorified administrators occasionally attempting to promote something like the management trend du jour. If they're at the right place at the right time they're lauded. If they're not they move on. To be fair, CEOs of large companies have quite a lot to administer, though they're most certainly overcompensated for what they do.

    • YooHoo (to acknowledge the google plant Marisa mayer's undermining strategy"

      suggest your own below

      • The Company Formerly Known as Yahoo
        YaHole or maybe YaHolio
        Yarbles (as in a kick in the Yarbles during a little ultraviolence).
        YaFoo

      • It would just be a holding company of some sort. Obviously the new company will have the yahoo.com domain and all the other assets associated with their online business. Seeing as how name recognition is probably the only thing they still have going for them, it would be stupid beyond belief to change their domain.

        "Yahoo.com is now xyz.com. Please visit our new site at xyz.com!" - can you imagine?

        I predict the original company (which will consist of just Alibaba shares) will rename itself to YahooBaba Inc,

    • by gweihir ( 88907 )

      I don't think so. Yahoo never was any good at what it does. I once had a domain there and even the tenth Customer Services Person did not understand what I meant by wanting to run my own DNS and I finally had to move it somewhere else. My guess is that level of understanding is common there. Hence the only thing needed to kill Yahoo is to wait. Mayer cannot really do anything, she just has the usual big ego and lack of understanding so common and usual in large company CEO's these days.

    • She is most definitely a plant [nocookie.net].
    • What exactly would another CEO have done differently? Attacking Mayer doesn't really deal with the fact that Yahoo has been in decline for a decade, and what she inherited was a listing ship with no obvious solution. Everything that is wrong with Yahoo is Jerry Chang's fault, including the stunningly stupid move of not just selling the whole fucking thing to Microsoft.

      • >> What exactly would another CEO have done differently? Attacking [Specific_CEO] doesn't really deal with the fact that [Company] has been in decline for [Period], and what [Pronoun] inherited was a listing ship with no obvious solution.

        Replace all those variables with "Steve Jobs", "Apple", "Seven Years" and "He" and see if you are still convinced that what CEO's do doesn't matter.

        • by dAzED1 ( 33635 )
          except jobs was still starting with a rabid fanbase still in place, very strong in academia. Why is that important? Because at that same moment, things were being pulled from academia to The Rest Of Us. Case in point: Myspace was already around with a large user base, Facebook was just college students. Facebook (full of people using macs) opened the doors to The Rest Of Us, and boom - now it's practically illegal to not have a facebook account. Same bit, the positioning was still very much there. So
          • >> except jobs was still starting with a rabid fanbase still in place, very strong in academia

            I was in academia at that time and we were ripping half the remaining Macs out to replace them with PCs, and the other half out to replace them with off-brand Macs (Umax, etc.) Meanwhile, we were experimenting with running Photoshop and Illustrator on PCs, and wondering how long the one remaining campus Mac store would be open (so we could reclaim the space). Long story short, I wouldn't have called us "rab

      • What exactly would another CEO have done differently?

        From the perspective of a long-time and fairly active flickr user, one thing they could have done was given the users the features they have constantly been asking for, instead of constant "UX" changes that (a) no one wanted and (b) removed useful features.

        From the perspective of a groups user, bringing the groups up to, oh, say, the 2005 level of message display and convenience might have done something for them. It would have been nice not to have to

      • Analysts in many areas have been calling for a different approach for a long time: Concentrate on the areas in which you are successful - cull the rest. Yahoo is strong in email, fantasy sports, news aggregation, and a number of other things. Concentrating on these key areas would have made for a smaller, more focused enterprise.

        Instead, Yahoo did the exact opposite - go out and buy a bunch of other companies and increase scope to include a bunch of new areas - further diluting itself.

        Yahoo wanted to be s

    • Yahoo has recently been valued in the negative by a Wall Street weasel. probably accurately. I haven't been to the site for a decade. Oh, wait, I take that back, I was looking for instructions online on replacing the suspension air shocks on my car, and looked like an interesting link. well, it went to a crap page with thousands of unanswered questions... and the ones that were answered, on the order of "how do I apply nail polish?" had lame joke answers.

      Yahoo can die now.

    • So would Marissa Meyer now be the CEO of the spun off company, whatever it's called?
  • Am I being naive (Score:5, Interesting)

    by Chrisq ( 894406 ) on Wednesday December 09, 2015 @11:04AM (#51088125)
    Am I being naive, or just is this just a way of moving Alibaba into American ownership?

    You have two companies, Alibaba (Chinese) and Yahoo (US). Yahoo takes over Alibaba to make one company (US). Yahoo disinvests everything into a different company, call it exactly-what-yahoo-was-before.com (US) and is now a new US company, called Yahoo but being exactly what Alibaba was before.

    • by DarkOx ( 621550 )

      That sounds about right. There might be some really exiting fraud happening too.

      Those shares in Alibaba at that are not exactly unencumbered in terms of legal questions surrounding their value. It depends on Alibaba doing what they promise to do with the subsidiary the shares are actually in.

      What legal recourse the share holders have if Alibaba ultimately decides to alter the terms is an open question. It also supposes the Chinese government won't for whatever reason decide to interfere with something that

    • Re:Am I being naive (Score:5, Informative)

      by ranton ( 36917 ) on Wednesday December 09, 2015 @11:16AM (#51088191)

      Am I being naive, or just is this just a way of moving Alibaba into American ownership?

      Yahoo only owns 15% of Alibaba, so it certainly is not a US company.

      • by torqer ( 538711 )

        If you really have your tinfoil hats ready:

        According to the Helms-Burton Act of 1996, 15% ownership by an American company is enough to stop Alibaba from dealing with Cuba.

    • by xxxJonBoyxxx ( 565205 ) on Wednesday December 09, 2015 @11:17AM (#51088195)

      >> is this just a way of moving Alibaba into American ownership?

      I saw it as a defensive move by Yahoo bigwigs. Alibaba is the only thing in the Yahoo portfolio that's worth anything. If Yahoo's CEO/board sells Alibaba, the rest of Yahoo gets liquidated and they're quickly out of their cushy jobs. By hanging onto Alibaba, Yahoo's CEO/board forces Yahoo stockholders have to get even more creative (e.g., invest in bigger golden parachutes) to get them out of the way. And by hanging onto the assorted businesses, Yahoo's CEO/board look busy "managing" them or spin them off (like chaff) to distract any pesky press continuing to ask why Yahoo continues to fail.

    • Am I being naive, or just is this just a way of moving Alibaba into American ownership?

      You have two companies, Alibaba (Chinese) and Yahoo (US). Yahoo takes over Alibaba to make one company (US). Yahoo disinvests everything into a different company, call it exactly-what-yahoo-was-before.com (US) and is now a new US company, called Yahoo but being exactly what Alibaba was before.

      How can you take a massive foreign company with just a 15% stake? Certainly 15% is much greater (in relative numbers) than Elliot Management 7% activist stake in Citrix (for example.) But I have a hard time believing a 15% stake on a Chinese company the size of Alibaba will somehow translate into American ownership.

  • What? (Score:2, Informative)

    Yahoo isn't relevant anymore as a technology company. It's just a stagnant e-dinosaur that holds billions in hardware and patents and a CEO that shut-ins enjoy beating off to.
  • If Yahoo is just an entity that owns 15% of Alibaba, is it just a holding company? Would they just need to be staffed by a dozen people who file quarterly reports? Does anyone know if Yahoo's stake in Alibaba includes actual management and/or engineering responsibilities?

  • tax avoidance (Score:5, Informative)

    by AndroSyn ( 89960 ) on Wednesday December 09, 2015 @11:17AM (#51088199) Homepage

    The reason this is being done is that Yahoo couldn't get a promise from the IRS that selling off Alibaba shares wouldn't be tax free. So they are doing this game of making the current company a holding company for the Alibaba shares, then putting the rest of the company in a "new" company. This is just tax avoidance, nothing more.

    • by Kohath ( 38547 )

      Yeah. Taxes are so low that all these companies are merging or otherwise completely changing their structure to avoid paying them. All of these executives must not be able to add and subtract, because they are making strategic decisions based on taxes -- which some Slashdot commenters insist are low -- instead of anything about the actual business that they do.

      Why aren't these executives happy to pay taxes for the extremely valuable benefits they get from extra government? These executives must be doubly

    • It's not tax avoidance per se. The IRS issues a huge number of "written determinations" [irs.gov] each year to clarify ambiguities in the tax code. Unfortunately, its vastness makes it difficult to search (while providing a steady income for tax attorneys), and many of the clarifications are so specific that you can't be certain if it'll apply to your case because a variable or two are different.

      This isn't like math or physics, where there's an immutable grand order and self-consistency which allows perfect pred
  • by Hognoxious ( 631665 ) on Wednesday December 09, 2015 @11:19AM (#51088203) Homepage Journal

    The article notes that this probably means trouble for CEO Marissa Mayer

    Did she actually fuck up big-time, or did she just sort of muddle through without actually achieving much?

    Because if it's the former, she could run in 2020.

    • Yes, everything she touched at Yahoo turned to complete shit:

      Acquisitions: Stamped, OnTheAir, Snip.it, Summly, xobni, Astrid. Basically everything but Tumblr or ad companies.

      "Improvements" to: message boards, Flickr, sports, the logo, mail

      Other shenanigans: NSA webcam pics, Java ad exploit

      It was not a good 3.5 years. The only smart things she did was 1) approve repurchasing of some more Alibaba shares that they had sold back right before she took over, and 2) purchasing Tumblr (at least until they Yahoo

  • The estimate of the number of users of Yahoo stuff is 1 billion. That's not all that far off the estimated 1.5bn for Facebook. It's also got an annual income a bit north of 7 billion dollars.

    It seems remarkable that the value of that is considered so low in Yahoo compared to other companies. I guess people don't like seeing the future of those rather overvalued companies...

    • Good point. How any business can have 1/7 of the entire population of the planet as users and be considered "struggling" is a bit strange. Unless they are bleeding money giving it all away for free in order to have that many users.

      • How any business can have 1/7 of the entire population of the planet as users and be considered "struggling" is a bit strange. Unless they are bleeding money giving it all away for free in order to have that many users.

        Answers own question.

  • by JoeyRox ( 2711699 ) on Wednesday December 09, 2015 @11:26AM (#51088251)
    Marissa's salary at Yahoo (wages, options, and bonuses):

    2014: $42 million
    2013: $25 million
    2012: $36 million
    And I'm sure she'll be getting a nice parachute as well. That's pretty steep compensation for a company that has performed so poorly.

    Meanwhile employees had their remote-work privileges revoked, allowing them to watch this slow-motion trainwreck of a CEO up close. And employees were recently asked by Mayer to reup for a long-term commitment to the company. Where does this leave all of them?
    • >> I'm sure she'll be getting a nice parachute as well

      CNN calculated her current parachute could be $110M if Yahoo sells itself (which they are positioning themselves to do by shedding crap like Yahoo) or "just" $25.8 million if the board makes her redundant.
      http://money.cnn.com/2015/12/0... [cnn.com]

    • Meanwhile employees had their remote-work privileges revoked, allowing them to watch this slow-motion trainwreck of a CEO up close. And employees were recently asked by Mayer to reup for a long-term commitment to the company. Where does this leave all of them?

      At least she's easy to look at [forbesimg.com]. I'd hate to go through all of this while looking at Michael Dell or someone like that.

      • haha, true. That voice though - she sounds like Marge's sisters from the Simpsons.

        Marissa: https://www.youtube.com/watch?... [youtube.com]
        Patty and Selma: https://www.youtube.com/watch?... [youtube.com]
        • That voice though - she sounds like Marge's sisters from the Simpsons.

          I could deal with that. If she had one of those Kardashian voices though, that would be impossible.

      • by swb ( 14022 )

        I think she is quite attractive.

        I'm curious about the psychology of how that works.

        I would bet more than a few men she's worked with have spent at least some time thinking "I wonder what she looks like naked" or "I wonder what she's like to have sex with".

        Does she think about that? Does it undermine her confidence -- "these guys aren't taking me seriously, they're thinking about what I'm like bent over a couch".

        Or increase it somehow, knowing that maybe its something she can use against them -- "these moro

        • Strangely, none of these questions come to mind when I think about Meg Whitman.

          That's not strange, that's perfectly normal.

    • And her time as the CEO of Yahoo will make her an experienced, qualified candidate for President.
  • Yahoo hasn't been yahoo for many years.

  • I'd suggest "Yay!" to save valuable screen real estate on smartphones.
  • by PopeRatzo ( 965947 ) on Wednesday December 09, 2015 @11:37AM (#51088323) Journal

    Spin off this.

  • So, so we are supposed to invest all our retirement funds in an American company that is betting that the Chinese will beat us economically with their socialist version of free trade? Their stock market just tanked not so long ago, should we worry?

    Oh, and remember that their stock market reporting and analysis services are completely non-biased. What could go wrong?

  • What a pain! Will the Yahoo mail systems close down? I do not know how many places my e-mail is at. (Including /.) Nothing else seems to work as well for me.

    Ok, so it is called ATT mail. Still yahoo app.

    • by k6mfw ( 1182893 )
      I'm concerned as well as I have a yahoo email. I'm also on a few yahoogroups that are informative and useful even if the formatting these days is worst than it used to be (hotmail is worst). Everyone says go to gmail and googlegroups, but it seems I continually have to upgrade to upgrade in order to meet the next upgrade of google systems (OK so I don't fully understand all of google services, I don't work for them nor do I do work for them for free).
  • When I first read this, gotta admit, I kinda thought "Whaaaa?"

    But it hit me. This will be an EXCELLENT opportunity for Yahoo! (YAHOO!? Yahoo!? Yahoo?) to finally move past an 800lb elephant standing in the corner...right over there...IN THE CORNER!

    THAT NAME.

    C'mon. "Yahoo!" was fun back in the '90s. That was the internet then. But it doesn't carry the same reverence now. And this move provides a chance. If Yahoo was named something...BETTER...maybe some of its issues would be different. Sure, getting a DOMAI

  • Meyer chose that name so that it will be in front of the phone book!
  • by fahrbot-bot ( 874524 ) on Wednesday December 09, 2015 @12:57PM (#51088873)

    Ya-who ?

  • Core Yahoo is nothing. It will just circle the drain until someone snaps it up for cheap.

  • by Steve1952 ( 651150 ) on Wednesday December 09, 2015 @01:40PM (#51089235)
    Yahoo (present) renames it self to Acme Holdings, and spins off the Yahoo part as Yahoo. Presto! Yahoo now divested of non-Yahoo parts, and can even keep calling itself Yahoo. Acme Holdings then renames it self to whatever.
  • by dAzED1 ( 33635 ) on Wednesday December 09, 2015 @01:45PM (#51089261) Homepage Journal
    Yahoo Screen has a cute/fun show called /,a href="https://screen.yahoo.com/other-space/">Other Space, have been patiently waiting for season 2... The show has Milana Vayntrub in it - the woman in the AT&T commercials, for people who go crazy over women in commercials. She wasn't why I watched the show, but she did a great job.

All syllogisms have three parts, therefore this is not a syllogism.

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