Will Yahoo! Fail Even With Microsoft Bailout?

When Microsoft and Yahoo! reached a deal recently there were glowing accolades that Yahoo! would now be free to do its real business, which was not search. The company CEO claimed that Yahoo! would be free to explore its other development options. But behind the scenes all was not well in Yahoo! land.

According to one report there was a memo sent out to the troops which stated:

An unhappy memo from Yahoo! Inc. CEO Carol Bartz was published Tuesday, a day after investor Carl Icahn revealed he recently sold about 13 million shares in the company.

The Bartz memo, published in Dow Jones All Things Digital blog, urges employees at the Sunnyvale, Calif.-based company (NASDAQ: YHOO) to get back to work and stop debating the merits of her recent search deal with Microsoft Corp.

In it she tells employees to “get out of the sugar low — we have work to do. Stop staring at our navels, stop arguing with each other. Stop debate, debate, debate, and let’s focus on the competition.”

But it gets better. It seems that the Yahoo! CEO along with other Yahoo! executives are selling their Yahoo! stock:

According to regulatory filings, Bartz has made two major stock sales in the past nine months — more than $830,000 (£500,000) in March and a further $1.14m in June.

The 61-year-old former boss of the software company AutoDesk, who also receives a salary of $1m and is eligible for an annual bonus worth up to $4m, was granted options on 5m shares of Yahoo! stock when she took the top job at the beginning of the year.

The news does not fit with the image she has tried to portray since taking over at the company earlier this year, hired as a pragmatic and efficient replacement for Yahoo!’s co-founder, Jerry Yang.

So I would venture a guess that Yahoo! is going to fall right on its face as everyone at the company starts to bail out. It comes down to only one thing. Money.

Comments welcome.

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