Despite a partnership with Microsoft's Bing search engine, Yahoo has also been losing share in advertising tied to Internet searches. Bing recently passed Yahoo to become the second most popular search engine in the U.S. after Google, according
to data from comScore, leaving Yahoo in third place.
While many critics blamed Bartz for failing to turn the business around over the past two years, some have also blamed Yang and Chairman Roy Bostock for not anticipating major shifts in the Internet business, such as the dominance of Google's search engine or the rapid rise of social networking sites such as Facebook and Twitter.
"He cast such a big shadow over this board. They would not make any decision without asking themselves 'What does Jerry think?' That attitude led to indecision, and as a result we've seen what happened over the last six years," Jackson said.
"He's a figure who, rightly or wrongly, is associated with lost opportunities," Kessler added.
Filo, who avoided any executive position at Yahoo, continues to serve as what the company calls "a key technologist," a loosely defined role in which he advises and oversees some technical operations.
Yang, in contrast, has been involved in running Yahoo and served as its public face during key moments in the company's history.
He was chief executive for a very brief period when Yahoo was still a startup, before hiring a more experienced manager, Tim Koogle, as CEO in 1995. Yang also played a key role in a shake-up that replaced Koogle with veteran entertainment executive Terry Semel in 2001.
Microsoft offer rebuffed
After the company stumbled in 2007, Yang once again led a shake-up in which Semel was ousted and Yang emerged as CEO. He held the job for two years, and earned lasting resentment from some shareholders when he balked at Microsoft's offer to buy the company for $33 a share.
Yahoo's stock closed Friday at $15.43, less than half the Microsoft offer, although it rose nearly 3 percent in late trading after Yang's resignation was announced.
Some of that gain came after several analysts reported Yang's departure would probably clear the way for Yahoo to proceed with a sale of its Asian operations or some other transaction that could either benefit shareholders or allow the company to invest in developing new business.
"We're not sure that Yang stepping down was necessarily required for a deal to get done," Macqurie Securities analyst Ben Schachter wrote in a note to clients. But he added that Yang's departure "could remove a potentially complicating factor."
Some suggested Yang may have been unhappy with the direction the company is going. "I think it's the clearest sign we've seen that the company will be carved up in one way or another, and Yang doesn't want to be associated with what's going to happen," said Rick Munarriz, an analyst at the Motley Fool investment website.
Yang has been a Silicon Valley "institution," Munarriz added. "The company will miss him, but the company that will miss him will not be the same company that we've seen before."
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YAHOO THROUGH THE YEARS
February 1994: Yang and fellow Stanford University graduate student David Filo found Yahoo. April 12, 1996: Yahoo, with 49 employees, has a highly successful IPO. Jan. 3, 2000: Stock reaches all-time high of $118.75. June 26, 2000: Yahoo swaps its Internet search partnership with Inktomi for fast-growing rival Google, making Google the new engine powering Yahoo searches. Sept. 26, 2001: Stock bottoms out at $4.05. Feb. 18, 2004: Yahoo stops using Google's search engine and begins relying on its own search technology, deciding to compete directly with Google. 2005-2007: Bare-knuckles battle with Google bruises Yahoo. By January 2007, Google has a majority of core U.S. searches, while Yahoo's share has slipped to 27 percent. June 2007: Co-founder Yang becomes CEO when Terry Semel resigns. Jan. 29, 2008: Yahoo announces it will lay off 1,000 workers, its largest layoff since the dot-com bust. Feb. 1: Microsoft makes an unsolicited takeover bid to buy Yahoo for $44.6 billion in cash and stock, at $31 a share. Feb. 11: Yahoo's board rejects Microsoft's offer. June 12: Yang says Yahoo has rejected a third and final bid from Microsoft, and announces a 10-year advertising partnership with Google. Yahoo's stock drops 10 percent. The Google deal later draws opposition from antitrust regulators and is never consummated. Nov. 17: Yahoo announces that Yang will step down as CEO. Jan. 13, 2009: Carol Bartz becomes CEO. July 29: Yahoo and Microsoft announce a 10-year deal to collaborate on search. The next day, Yahoo's share price is at $15.14, about 60% lower than Microsoft's takeover bid a year earlier. Sept. 6, 2011: Carol Bartz is abruptly fired by the board of directors. Jan. 5, 2012: Yahoo recruits eBay executive Scott Thompson to be the new CEO. Jan 17: Yang resigns as company director, ending his tenure with the company he cofounded.
Source: Yahoo, comScore, Bay Area News Group archives
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