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Yahoo! Inc. (1995–2017)

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Yahoo! Inc.
Company typePublic (until 2017)
IndustryTechnology
FoundedJanuary 1994; 32 years ago (1994-01)
FounderJerry Yang, David Filo
DefunctJune 13, 2017 (2017-06-13)
FateInternet business acquired by Verizon Communications; renamed Altaba Inc.
Headquarters
Sunnyvale, California
,
United States
Area served
Worldwide
Key people
Marissa Mayer (CEO 2012–2017)
ProductsWeb portal, search engine, Yahoo! Mail, Yahoo! News, Yahoo! Finance, Yahoo! Groups, Yahoo! Answers, advertising solutions, online mapping, video sharing, fantasy sports, social networking platforms
Number of employees
(not specified)
ParentVerizon Communications (after 2017)

Yahoo! Inc. was a prominent American multinational technology company based in Sunnyvale, California. Established by Jerry Yang and David Filo in January 1994 and officially incorporated in March 1995, Yahoo emerged as a trailblazer during the early days of the internet.[1] The company was led by former Google executive Marissa Mayer, who held the CEO position from July 2012 until June 2017.[2]

Internationally known for its Web portal, Yahoo! Search, and an array of services including Yahoo! Mail, Yahoo! News, Yahoo! Finance, Yahoo! Groups, Yahoo! Answers, advertising solutions, online mapping, video sharing, fantasy sports, and social networking platforms, Yahoo ranked among the top websites in the U.S. during its prime.[3] In 2016, it stood as the sixth most frequented website globally, attracting over seven billion monthly page views and approximately 700 million unique users each month.[4] Yahoo asserted that it reached "more than half a billion consumers every month in more than 30 languages."[5]

Following a period of dominance within the U.S. market, Yahoo began to experience a downturn starting in the late 2000s.[6] On February 21, 2017, Verizon Communications revealed plans to purchase Yahoo's internet business—excluding its holdings in Alibaba Group and Yahoo! Japan—for $4.48 billion, marking a substantial decrease from its previous valuation exceeding $100 billion.[7] Prior to finalizing the transaction, Yahoo intended to rename itself Altaba Inc..[8] Verizon completed the acquisition on June 13, 2017,[9] integrating Yahoo’s online assets with AOL under a subsidiary initially named Oath, later rebranded as Verizon Media, and eventually adopting the current Yahoo! Inc. identity in 2021.[10]

Founding

In January 1994, electrical engineering graduate students Jerry Yang and David Filo at Stanford University launched a website titled "Jerry and David's Guide to the World Wide Web". This platform served as a directory of websites arranged hierarchically instead of functioning as a searchable index. By March 1994, it was rebranded as "Yahoo!", introducing the human-curated Yahoo! Directory, which became their initial product and core business focus. The domain "yahoo.com" was officially registered on January 18, 1995.

The term "Yahoo" is a backronym standing for "Yet Another Hierarchically Organized Oracle" or "Yet Another Hierarchical Officious Oracle", highlighting the site's structured database design. The word "oracle" suggested a source of reliable information, while "officious" referenced office workers utilizing the directory during work hours. Nonetheless, Yang and Filo primarily selected the name due to its slang definition—a "yahoo" referring to an unsophisticated rural Southerner—originating from the fictional Yahoo creatures found in Gulliver's Travels.

Expansion

Throughout the 1990s, Yahoo expanded swiftly by adding a web portal and becoming the foremost entry point for internet users by 1998. Its human-edited Yahoo Directory led search engine rankings, complemented by several notable acquisitions.

Yahoo!'s initial public offering on April 12, 1996, closed at $33.00 per share—an increase of 270% over its IPO price—and reached an intraday high of $43.00 that same day. During the dot-com bubble, its stock price peaked at $118.75 on January 3, 2000 before plummeting to $8.11 on September 26, 2001 following the bubble's collapse.

In 2000, Yahoo initially relied on Google’s search technology but developed its proprietary search engine by 2004. In response to Google's Gmail launch, Yahoo introduced unlimited email storage in 2007. Despite these initiatives, significant challenges arose in 2008 including major workforce reductions.

Microsoft made an unsolicited offer of $44.6 billion to acquire Yahoo in February 2008; however, this bid was declined as undervaluing the company. By 2011, Yahoo’s market capitalization had diminished to $22.24 billion.<ref>Carol Bartz succeeded Yang as CEO in January 2009 but was dismissed in September 2011; CFO Tim Morse acted as Interim CEO.

Following Scott Thompson (businessman)’s appointment as CEO in early 2012, layoffs were anticipated and key executives such as Chief Product Officer Blake Irving exited. In April that year, Yahoo reduced its workforce by roughly 14%, equating to about 2,000 positions to achieve annual savings near $375 million. Thompson restructured the organization but was removed less than two months later and replaced by interim CEO Ross Levinsohn. His tenure lasted just 130 days with total compensation exceeding $7.3 million.

On July 16, 2012, Marissa Mayer took over as president and CEO.<ref>

In May 2013, Yahoo acquired blogging platform Tumblr for $1.1 billion; founder David Karp retained significant ownership. This move aligned with industry trends where technology leaders purchased startups with extensive online communities despite limited revenue streams to bolster social networking capabilities.

In August 2013, Yahoo purchased Rockmelt, maintaining its personnel while discontinuing all prior products.

According to July 2013 comScore data, more U.S. users visited Yahoo websites than Google for the first time since 2011 (excluding mobile and Tumblr traffic).

In November 2014, Yahoo ventured into video advertising through its acquisition of BrightRoll for $640 million and also acquired Cooliris.

Decline, security breaches, Verizon acquisition

By the fourth quarter of 2013, Yahoo's stock price had surged to more than twice its value since Marissa Mayer assumed the presidency in July 2012, reaching a high near $35 in November 2013. It briefly climbed to $36.04 on December 2, 2015, amid speculation regarding Mayer's tenure and the possibility of selling the struggling internet company. Nevertheless, certain strategies initiated under Mayer—such as the $1.1 billion purchase of Tumblr and investments in original video content—did not yield expected profits, resulting in a $42 million impairment charge. Sydney Finkelstein from Dartmouth suggested that divesting the company might sometimes represent the most prudent course of action. On December 7, 2015, Yahoo's stock closed at $34.68.

In early 2016, reports emerged indicating Mayer intended to reduce Yahoo’s workforce by up to 15% as part of efficiency improvements.

On July 25, 2016, Verizon Communications announced its plan to acquire Yahoo’s core internet operations for $4.83 billion. These assets were merged with AOL to create Oath, which preserved distinct brands including Yahoo and Huffington Post under its umbrella. Importantly, Yahoo retained its 15% ownership in Alibaba Group and a 35.5% stake in Yahoo! Japan through a separate entity named Altaba, managed by an independent executive team.

On September 22, 2016, Yahoo revealed a significant data breach dating back to late 2014 that compromised at least 500 million user accounts—ranking among the largest data breaches ever reported. The United States charged four individuals, including two agents from Russia’s FSB, for their involvement. Later in December 2016, Yahoo disclosed another breach from that same year affecting over one billion accounts; attackers used stolen internal software tools to create forged cookies.

In response to these security incidents, Verizon sought to lower the acquisition price by $250 million, which temporarily boosted Yahoo’s stock value. On February 21, 2017, Verizon agreed to decrease the purchase price by $350 million and share responsibility for costs related to breach investigations.

Yahoo shareholders gave their approval for the sale of internet assets to Verizon at $4.48 billion on June 8, 2017; the deal was finalized on June 13, 2017.

Chief Executive Officers

Between 1995 and 2017, eight individuals served as Yahoo’s chief executives or interim leaders:

For information on CEOs leading the restructured Yahoo after 2017, see Yahoo! Inc. (2017–present)#Chief Executive Officers.

Products and services

Yahoo functioned as a portal delivering news coverage across entertainment and sports sectors while providing access to essential services such as Yahoo! Search, Yahoo Mail, Yahoo Maps, Yahoo Finance, Yahoo Groups, and Yahoo Messenger.

Communication

Yahoo’s communication suite comprised Yahoo Messenger and Yahoo Mail—the latter offering unlimited storage capacity as of May 2007.

Additionally, the company hosted social networking and user-generated content platforms including My Web, Yahoo Personals, Yahoo 360°, Delicious, Flickr, and Yahoo Buzz. Several of these services—such as Yahoo Buzz and MyBlogLog—were discontinued on April 21, 2011.

Yahoo Photos was shuttered in September 2007 in favor of Flickr. In October 2007, Yahoo announced it would retire Yahoo 360°, intending to replace it with a "universal profile" system similar to the experimental platform Yahoo Mash.

Content

Yahoo collaborates with a wide array of content providers to support its offerings such as Yahoo Sports, Yahoo Finance, Yahoo Music, Yahoo Movies, Yahoo Weather, Yahoo News, Yahoo! Answers, and Yahoo Games, delivering news and related materials. Its personalization platform, My Yahoo, enables users to tailor a single page by selecting preferred Yahoo features and content streams.

On March 31, 2008, Yahoo introduced Shine, a service aimed at women between 25 and 54 years old seeking online information and guidance.

Co-branded Internet services

Yahoo has established partnerships with broadband companies including AT&T Inc. (through Prodigy, BellSouth, and SBC), Verizon Communications, Rogers Communications, and British Telecom. These collaborations provide a combination of complimentary and premium Yahoo content and services bundled with broadband subscriptions.

Mobile services

Yahoo Mobile offers email, instant messaging, mobile blogging, information retrieval, search capabilities, and alert notifications. Features for camera phones include entertainment options and downloadable ringtones.

On March 20, 2007, Yahoo debuted OneSearch for mobile devices, delivering results such as news headlines, Flickr photos, business listings, local weather updates, and website links. OneSearch focuses on local relevance by displaying nearby cinemas showing films along with user reviews and related news stories. To perform local searches, users must input a zip code or city name.

Search results appear on a single screen and are organized by category priority.

As of 2012, Yahoo employed the mobile content transcoding service from Novarra to enhance OneSearch.

On October 8, 2010, Yahoo announced plans to add video chat functionality to mobile devices via Yahoo Messenger.

Commerce

Yahoo manages various shopping platforms including Yahoo! Shopping, Yahoo Autos, Yahoo Real Estate, and Yahoo Travel, which assist users in gathering information and completing online transactions. The Yahoo Auctions service was discontinued outside Asia in 2007. Yahoo Shopping operates as a price comparison service based on the Kelkoo platform acquired in April 2004.

Small business

For small enterprises, Yahoo provides services such as Yahoo DomainKeys, Yahoo Web Hosting, Yahoo Merchant Solutions, Yahoo Business Email, and Yahoo Store—tools that enable entrepreneurs to establish online storefronts using Yahoo’s infrastructure.

Advertising

Yahoo Search Marketing delivers advertising solutions including Sponsored Search, Local Advertising, and Product/Travel/Directory Submit options that allow businesses to promote across the Yahoo ecosystem.

Following the closure of its "beta" phase in April 2010, the Yahoo Publisher Network was relaunched as a platform enabling online publishers to earn revenue through contextually relevant advertisements on their websites.

In February 2007, Yahoo rolled out its Panama ad sales platform, which permits advertisers to bid on search keywords. Panama ranks advertisements by considering bids, quality scores, and clickthrough rates to enhance ad relevance and monetization effectiveness.

In April 2008, Yahoo introduced APT from Yahoo, an online advertising management system designed to integrate buyer and seller markets for streamlined ad sales. This service officially launched in September 2008.

In September 2011, Yahoo entered into a strategic advertising sales alliance with competitors AOL and Microsoft. However, by 2013 this partnership underachieved; Microsoft captured only a minor share of Yahoo’s search traffic without expanding the overall market presence.

On September 27, 2023, Yahoo collaborated with Good-Loop to provide carbon-neutral private marketplace (PMP) media options that support advertisers' environmental sustainability objectives.

GeoPlanet

Yahoo delivers mapping and geographic solutions through its GeoPlanet platform.

Yahoo Next

Serving as an innovation hub, Yahoo Next showcases developing Yahoo technologies and includes forums where users can provide feedback to support ongoing enhancements.

Yahoo BOSS

Yahoo Search BOSS allows developers to build search applications leveraging Yahoo's search infrastructure. Early collaborators included Hakia, Me.dium, Delver, Daylife, and Yebol.

In early 2011, Yahoo shifted BOSS to a paid model based on cost-per-query, with fees ranging from $0.40 to $0.75 CPM depending on the type of query, such as web, image, or news searches.

Yahoo Meme

Yahoo Meme is a beta-stage social platform resembling services like Twitter and Jaiku.

Y!Connect

Y!Connect enables users to post comments on online content using their Yahoo ID, eliminating the need for separate account creation. This approach aimed to increase website traffic by utilizing user identities similarly to Facebook's strategy.

Yahoo Accessibility

Yahoo invests in enhancing web accessibility for individuals with disabilities through its dedicated Yahoo Accessibility Lab.

Yahoo Axis

Yahoo Axis is both a desktop browser extension and a mobile browser for iOS devices developed by Yahoo, officially launched on May 23, 2012. Shortly after release, a security concern emerged when the private key used to sign Yahoo Chrome extensions was inadvertently exposed.

Yahoo SearchMonkey

Yahoo SearchMonkey allowed developers to incorporate structured data into Yahoo Search results, boosting relevance and visual presentation to attract targeted visitors. The service was discontinued in October 2010 following the Microsoft-Yahoo search alliance. In 2008, SearchMonkey earned recognition as a leading Semantic Web product.

Defunct services

GeoCities, purchased by Yahoo in 1999, was once one of the most frequented websites offering public web hosting. It was shut down in 2009, resulting in the loss of approximately seven million web pages, though many were preserved by external archiving efforts.

Yahoo Go, a Java-based mobile application granting access to various Yahoo services, ceased operations in January 2010.

Yahoo 360°, a social networking and blogging platform introduced in 2005, was closed in July 2009. Likewise, Yahoo Mash, another social networking service, was discontinued after just one year.

Yahoo Photos was phased out by 2007 as Flickr became the primary photo-sharing platform. Yahoo Tech, which offered product reviews and setup guidance since 2006, ended in March 2010 with users redirected to Yahoo's technology news section. Additional retired services include Farechase, My Web, Audio Search, Pets, Live, Kickstart, Briefcase, and Yahoo for Teachers.

HotJobs was acquired by Monster.com and subsequently integrated into its offerings.

Yahoo Koprol, an Indonesian location-based social network acquired soon after its launch with around 1.5 million users mainly across Indonesia and Southeast Asia, was discontinued in August 2012 due to minimal revenue generation.

The classic version of Yahoo Mail began its phase-out in June 2013, urging users to transition to the updated Yahoo Mail or alternative email providers. In April 2013, several other services were also closed including Upcoming, Yahoo Deals, Yahoo SMS Alerts, Yahoo Kids, along with feature phone editions of Yahoo Mail and Messenger.

In July 2013, Yahoo announced it would shut down Astrid, a task management application acquired earlier that May. The service officially ended on August 5, 2013; users were advised to export their data and consider alternatives such as Wunderlist and Sandglaz.

Leak of internal Yahoo slide on Twitter regarding service changes

On December 15, 2010, shortly after Yahoo declared a reduction of its workforce by 4% across various divisions, Eric Marcoullier, founder of MyBlogLog, posted on Twitter a slide originating from a Yahoo employee. This slide, presented during an internal strategic webcast, detailed upcoming modifications planned for Yahoo's offerings.

The slide's "Sunset" section identified services scheduled for termination: Yahoo Picks, AltaVista, MyM, AlltheWeb, Yahoo Bookmarks, Yahoo Buzz, del.icio.us, and MyBlogLog. Services listed under "Merge" included Upcoming, FoxyTunes, Yahoo Events, Yahoo People Search, Sideline, and FireEagle.

Yahoo intended to consolidate these into 11 feature sites within its portal, incorporating legacy tools such as Yahoo Address Book, Calendar, and Notepad. Although Notepad was classified as a feature service in 2010, it later received less focus; by January 2013, it was removed from the updated Yahoo Mail interface and ceased to be searchable.

After the slide surfaced publicly, Chris Yeh, a contributor to the del.icio.us blog, explained that the "Sunset" label did not guarantee shutdown; alternatives like selling or spinning off were under consideration. Indeed, on April 27, 2011, Yahoo sold del.icio.us to Avos.

Yahoo Buzz was discreetly discontinued on April 21, 2011. MyBlogLog followed shortly after with its closure on May 24, 2011.

Privacy

In its September 2013 transparency report, Yahoo disclosed receiving approximately 29,000 government requests for user data during the first half of that year, with over 12,000 originating from U.S. authorities.

In October 2013, The Washington Post revealed that the U.S. National Security Agency intercepted communications between Yahoo's data centers through a surveillance program known as Muscular.

By January 2014, Yahoo announced uncovering a "coordinated effort" aimed at compromising potentially millions of Yahoo Mail accounts. This led to mandatory password resets amid an ongoing federal investigation.

Collection of personal data and usage monitoring

Collaborating with comScore, The New York Times reported that Yahoo gathered substantially more user information than its competitors via its websites and advertising network. As of December 2007, Yahoo could compile profiles containing an average of 2,500 data points per visitor each month. The company retained search queries for up to 13 months but masked IP addresses after three months to comply with European regulations.

On March 29, 2012, Yahoo announced the introduction of a "Do Not Track" option enabling users to opt out from tracking and targeted advertising. Nonetheless, by April 30, 2014, Yahoo ceased support for the "Do Not Track" browser setting.

A 2008 article in Computerworld highlighted Yahoo's extensive data warehouse totaling two petabytes that analyzed behavior from its half-billion monthly visitors and processed approximately 24 billion daily events—vastly surpassing the U.S. IRS database size of 150 terabytes.

In September 2016, it was confirmed that data from at least 500 million Yahoo accounts had been compromised in a breach dating back to 2014.

Reuters reported in October 2016 that in 2015 Yahoo developed software capable of scanning customers' emails upon requests from the NSA or FBI.

Criticism

In 2000, Yahoo was subjected to legal proceedings in France aimed at halting the sale of Nazi-related memorabilia. By March 2004, the company introduced a paid inclusion initiative that assured commercial websites placement within its search results; this program was discontinued by late 2009. Additionally, Yahoo encountered backlash for distributing advertisements through spyware and adware channels.

Yahoo's collaboration with Chinese governmental censorship drew significant condemnation, especially after the 2005 imprisonment of dissident Shi Tao, who was identified via his IP address. Human rights organizations accused Yahoo of facilitating the detention of other activists such as Li Zhi and Jiang Lijun. In 2017, lawsuits were filed against Yahoo for allegedly breaching settlement agreements connected to these incidents. Although the company committed to supporting human rights through the Yahoo Human Rights Trust, controversy arose over the misuse of funds on real estate and unrelated expenditures.

In 2003, Wang Xiaoning, a dissident, received a decade-long sentence following Yahoo Hong Kong's involvement in linking his organization to a particular email account. Wang’s spouse and human rights advocates initiated legal action against Yahoo under international human rights statutes.

Amid concerns about online child exploitation and insufficient advertising revenue, Yahoo terminated its user-generated chatrooms in June 2005. The image search function faced criticism in May 2006 for displaying explicit content despite SafeSearch being enabled.

Yahoo held a substantial ownership interest—40% as of August 2014—in Alibaba Group, which was embroiled in controversy over the sale of shark fin products. Consequently, Yahoo prohibited such items on its e-commerce platforms starting January 1, 2009. In November 2009, the Electronic Frontier Foundation censured Yahoo for issuing a DMCA takedown notice against Cryptome, a whistleblower website that had published leaked subscriber data.

Concerns arose in 2011 regarding the censorship of emails related to Occupy Wall Street protests; Yahoo issued an apology attributing the issue to an inadvertent error.

Allegations of sexism against men

Scott Ard, formerly serving as editorial director until his termination in 2015, filed a lawsuit accusing then-CEO Marissa Mayer of orchestrating discriminatory practices targeting male employees. Ard alleged that Mayer encouraged supervisors to manipulate the employee performance evaluation system to the detriment of men. Despite consistently receiving "fully satisfactory" ratings since 2011 in his role overseeing editorial programming for Yahoo’s homepage, Ard was supplanted by a newly appointed female editor under Megan Lieberman’s leadership.

The complaint asserts that Lieberman fabricated grounds for Ard’s dismissal by falsely alleging he failed to provide detailed descriptions of his responsibilities despite his compliance.

A second legal action was brought by Gregory Anderson but dismissed in 2014; it also claimed that Yahoo’s performance management process was capricious and biased against male staff members. These lawsuits represented notable legal challenges confronting both Yahoo and Mayer during 2016.

Board of Directors

Chief Executive Officers

Henrique de Castro, who had been appointed by Mayer to reinvigorate Yahoo’s advertising division, left the company in January 2014 following his termination. Prior to joining Yahoo, de Castro gained experience at Google and McKinsey & Company.

Yahoo International

Yahoo provides a multilingual platform available in more than 20 languages. Its overseas operations are fully owned except in Japan and China. In Japan, Yahoo holds a 34.75% interest in Yahoo Japan, while SoftBank owns 35.45%. In New Zealand, the Yahoo!Xtra service operates as a joint venture with Telecom New Zealand holding 49%, and in Australia, Yahoo!7 is equally owned with the Seven Network. Yahoo previously collaborated with SoftBank for key European and South Korean markets but purchased SoftBank’s minority shares in these regions in 2005.

Following setbacks caused by the 2008 financial crisis, Yahoo launched localized services in Romania on March 8, 2011.

Yahoo expanded into the MENA region by acquiring the Arabic-language portal Maktoob on August 25, 2009, subsequently rebranding the regional service as Yahoo Maktoob.

Operations in South Korea ceased on December 31, 2012; thereafter, only a minimal search page powered by Bing remained briefly before being discontinued entirely.

Yahoo once held a 40% ownership stake in Alibaba, which operates autonomously using the Yahoo name within China. On September 18, 2012, Yahoo divested a 20% portion back to Alibaba for $7.6 billion.

Yahoo China terminated its services on September 2, 2013, redirecting users initially to taobao.com and later to Yahoo Singapore’s search interface.

Logos and themes

The first logo introduced in 1994 featured a red design with three icons flanking either side. Until May 2009, the homepage logo was red with black outlining and shadowing; it was then updated to a purple color without outlines or shadows as part of a global theme redesign—except for certain markets like Yahoo!7 in Australia, which maintained the red logo until 2014. The logo is sometimes shortened to "Y!".

On August 7, 2013, Yahoo announced plans for a new logo set to debut on September 5, initiating the "30 Days of Change" campaign that showcased daily logo variations leading up to the reveal. The official launch featured a video illustrating the digital creation process along with an extensive design narrative shared by CEO Marissa Mayer via her Tumblr account. Mayer characterized the updated logo as playful yet refined, contemporary while honoring Yahoo’s legacy, crafted to express a warm and personal identity.

On September 19, 2013, Yahoo refreshed its "My Yahoo" customizable homepage experience, allowing users to personalize widgets for email, calendars, Flickr, and other Yahoo or web content. Additionally, users could choose from "theme packs" designed by artists such as Polly Apfelbaum and musical groups like Empire of the Sun. Mayer later revealed that input from employees and external partners influenced the decision to redesign the logo.

See also

External links

  1. ↑ Yahoo! News, 2015
  2. ↑ The Times of India, 2012
  3. ↑ Quantcast, 2012
  4. ↑ Alexa Internet; SimilarWeb; USA Today; CBC News
  5. ↑ LinkedIn, 2012
  6. ↑ The Telegraph, 2016
  7. ↑ Reuters, 2017
  8. ↑ Variety, 2017
  9. ↑ CNBC; CNN Money
  10. ↑ CNBC; CNN Money
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