Justin Sullivan/Getty Images
A Yahoo! billboard is visible through trees in San Francisco, California.
Yahoo co-founder and chairman (and former CEO) Jerry Yang has resigned completely from Yahoo. The Wall Street Journal has a succinct explanation why:
Mr. Yang's exit is the latest chapter for Yahoo and underlines the widening gap between old Internet companies and newer ones. Yahoo was part of an earlier crop of Web companies from the 1990s that helped spark the dot-com boom and came of age as users world-wide began going online.
But after riding that wave, new companies such as Google Inc. and Facebook Inc.—often with younger leaders like 27-year-old Mark Zuckerberg at Facebook—came to prominence with Web technologies such as search and social networking, leaving older firms like Yahoo struggling to catch up.
Those two paragraphs, in their way, explain the precise problem with Yahoo: it isn't a tech company. Rather, it's a media company and always really has been. Yahoo was conceived in the Web 1.0 world of unruly distraction and idealistic alternatives to legacy media, especially television.
The companies that followed learned from Yahoo. Specifically, they learned that media isn't as good a product, at least not in Silicon Valley, as what gets dreamed up and made by computer engineers. That's what Web 2.0 is all about.
It might be too late now for Yahoo to revive itself by leveraging its vast audience and returning to being mainly a media company with some talented tech folks making it all rattle and hum. In any case, Yang's departure suggests that the company's new CEO, Scott Thompson, will now be caught in a vortex of new board members, agitating shareholders, and prospective private-equity investors.