Yahoo Fires Bartz: Numbers Speak Volumes

Yahoo finally confirmed rumors late Tuesday that the board of directors has fired CEO Carol Bartz. Timothy Morse stepped in as interim CEO, effective immediately. The Board has also named senior Yahoo executives to a newly formed executive role tasked to support Morse in managing the company's daily operations until a permanent chief executive is appointed, as well as supporting a strategic review that the Board has initiated to position the company for future growth.

It's been a rough few years for Bartz and Yahoo. The Sunnyvale, Calif. company continues to die a slow death. U.S. advertisers will spend 20.2% more this year -- reaching $31.3 billion, up from $26 billion in 2010, according to eMarketer estimates -- but Yahoo market share could decline as much as 11% this year, down from 13.3% in 2010.

Research firm eMarketer shared some interesting numbers. Google's share is expected to reach 40.8% this year -- up from 38.5% in 2010 and 34.9% in 2009 -- while Facebook's share of the overall U.S. online ad market share will reach 7% in 2011, up from 4.6% in 2010.

When it comes to U.S. display advertising, eMarketer expects Yahoo's share to fall to 13.1% in 2011, down from 14.4% in 2010. The overall U.S. display ad market, however, is set to grow 24.5% to $12.33 billion in 2011, up from $9.91 billion in 2010 -- higher growth than Yahoo's display business has seen in previous quarters this year.

As Yahoo's shares decline, competitors such as Facebook continue to rise. Facebook's share of U.S. online display ad revenue will reach 17.7% in 2011, up from a 12.2% market share last year. U.S. display ad revenue at Google will top $1 billion for the first time in 2011, as the company's share of overall display revenue grows to 9.3% from an 8.6% share in 2010, according to eMarketer.

Yahoo also faces the prospect of seeing its search revenue surpassed by Microsoft for the first time in 2011, according to eMarketer estimates. Net U.S. search ad revenue at Yahoo could dip to 7.9% market share of the $14.4 billion U.S. search advertising market in 2011, down from a 10.7% in 2010. eMarketer estimates Google's share of overall US search revenues will grow to 75.9% this year, up from a 73.6% share in 2010 and a 69.8% share in 2009.

No word on Bartz's compensation package. Nor is it clear whether the shakeup will affect the Microsoft and Yahoo search alliance. Marketers and advertisers will have to wait it out.

Bartz previously held the position of CEO and chairman at Autodesk, a supplier of computer design tools. She also held positions at Sun Microsystems and Cisco Systems.

2 comments about "Yahoo Fires Bartz: Numbers Speak Volumes".
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  1. Paul Benjou from The Center for Media Management Strategies, September 7, 2011 at 8:50 a.m.

    It's as obvious as the elephant in the room. The board and investors want an exit strategy. Before the vultures start circling, Yahoo! needs to quickly ramp up the bottom line. First move will be to cut overhead drastically (Bartz is the first of many to go).
    Paul Benjou

  2. Chris Nielsen from Domain Incubation, September 7, 2011 at 10:35 a.m.

    Are you sure Yahoo's display and other revenue is down?

    They didn't act like it when we contacted them about running display with them. The rep seemed somewhat interested but never followed through. Perhaps our $xxx,xxx budget was too small for them to bother with? Wait, maybe that is why they are in decline...???

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