San Francisco - Yahoo picked Google's Marissa Mayer to
become its new CEO, turning to an engineer with established Silicon Valley
credentials to turn around the struggling former internet powerhouse.
Mayer, 37, edged out frontrunner and acting chief executive
Ross Levinsohn to become Yahoo’s third CEO in a year. She hopes to stem losses
to Google and Facebook - which her high-profile predecessors failed to do.
Her hiring signalled the internet company is likely to renew
its focus on Web technology and products rather than beefing up online content.
Mayer, Google’s 20th employee and first female engineer, has
led a number of its businesses and was credited for envisioning the clean,
simple Google search interface still in use today, a major selling point for
Also known for her love of fashion and a regular on the
society pages, she joins the extremely thin ranks of female Silicon Valley CEOs
and told Reuters that she was immediately interested when Yahoo’s board reached
out to her in mid-June.
“This is a very competitive and a tough space. I don’t think
that success is by any means guaranteed,” she said.
“My focus is always
end-users, great technology and terrific talent.”
Shares of Yahoo, worth less than half their value during its
dotcom heyday, gained 2% to $15.97 in after-hours trading.
“It’s a statement on Yahoo’s part to go with a
product-centric CEO choice.
"It’s a very big commitment on the board’s part to
pursue a product-centric strategy,” venture capitalist Marc Andreessen told the
Fortune industry conference in Aspen, Colorado.
Tech companies can be turned around, he said, citing as an
example Apple, which had teetered on the brink of bankruptcy before Steve Jobs
returned to the company he co-founded.
“It’s a big job that Marissa is stepping
into,” Andreessen said.
Mayer will start on Tuesday, when the company is scheduled
to report its quarterly financial results, but she will not join the
post-release conference call.
Mayer also revealed on Twitter that she is pregnant with her
first child, a boy.
She told Fortune magazine that the baby is due on October 7
and she expects her maternity leave will only be a few weeks long.
Last responsible for Google’s local and location services,
she joins fellow female tech chieftains Meg Whitman of Hewlett Packard,
Virginia Rometty of International Business Machines and Ursula Burns of
“A lot of people did not believe that Yahoo could get
someone of the calibre of a Marissa Mayer to become the CEO at this stage,”
said S&P Capital IQ equity analyst Scott Kessler.
A year of turmoil
But Mayer’s ascension comes as her profile at Google
appeared to have diminished in recent months.
Shortly after Larry Page took
over the helm from Eric Schmidt, she was excluded from a group of top
executives reporting directly to the CEO and granted oversight over major
Google’s executive chairperson Eric Schmidt said Mayer’s hiring
was a “real win” for Yahoo. He, however, dismissed the notion that Mayer left
because she was marginalised at Google.
“I promoted her through the ranks and she is now running
this sort of big maps business, which is a lot of money,” Schmidt said on the
sidelines of the Fortune conference.
“It’s a nice big step for her,” he added. “It’s a loss for
Her appointment caps a tumultuous year at Yahoo. In May,
Scott Thompson resigned as CEO after less than 6 months on the job as a
controversy flared up over his academic credentials.
Thompson replaced the controversial and occasionally
foul-mouthed Carol Bartz, fired in September after failing to revitalise Yahoo.
“She’s going to bring in a different perspective. It’s
pretty clear Yahoo needs a new direction and really a new vision,” said Paul
Buchheit, a Google engineer who helped create Gmail and now a partner at
startup incubator Y-Combinator.
Yahoo had been widely expected to go with Levinsohn, who in
his few months at the helm tried to push a strategy of forging media
partnerships to beef up the company’s online content.
Mayer told Reuters Yahoo can excel as both a media and
tech company: “There’s a very
uninteresting debate happening around Yahoo between technology and media and it
doesn’t really make sense to me.
"Because you look at most major technology
companies, media is a big part of its business.”
She said it was too soon to talk about restructuring, but
was “sensitive to the fact that there has been a lot of change recently at
Yahoo, so I don’t want to make unnecessary changes”.
Still, given her relative inexperience in media, observers
are keen to see whether Mayer keeps an executive team that includes Mickie
Rosen and Michael Barrett - two ex-News Corp executives installed by Levinsohn
just months ago - and of course, Levinsohn himself.
“The great products at Yahoo are still, in the main, media
products,” said John Battelle, founder of Federated Media Publishing.
Sources have said that Levinsohn was committed to building
out Yahoo’s own video programming and striking more syndication deals in
pursuit of ads that command higher prices.
During his months-long tenure, Levinsohn ended a patent
dispute with Facebook and signed the social network onto a partnership.
after his appointment, he ended a fractious episode in Yahoo’s history by
sealing a deal to sell as much as half of its stake in China’s Alibaba, netting
But the board may not have endorsed his media-focused,
long-term plan to turn the ship around.
“I just think it was uninspired,” one source said on Monday,
referring to Levinsohn’s strategy.
A second source close to the situation said Mayer would try
to get Levinsohn to stay with the company.
“He’s not happy but he’s also not shocked given how the
process had been dragging out,” another source close to the company told
“Whether Ross stays or not depends on the chemistry with
Mayer and the commitment the company is willing to make to media. He won’t lack
Mayer joins Yahoo as something of a celebrity, having
already established herself as one of Silicon Valley’s leading women.
Walmart Stores nominated Mayer to its board of directors. One Google insider
described Mayer as being very intense and “intellectually impressive”, though
she could sometimes ruffle feathers.
“She does very little on an emotional, gut-level feel and
lets the numbers speak for themselves,” said the insider, who worked for years
“She can be difficult and she can be stubborn, particularly when
she has the data to support the facts of her argument.”
A self-described “geek” with a Masters in computer science
from Stanford, Mayer has frequently championed bringing more women into tech.
But nor has she been shy about discussing her sense of style
- and her love for all things Oscar de la Renta.
Mayer is known for hosting parties - from intimate literary
salons in her Four Seasons penthouse in San Francisco to Christmas bashes at
her home in Silicon Valley near the Googleplex - and is a regular on society
pages, especially after her wedding to real estate investor Zachary Bogue in
In 2010, the couple hosted a $30 000-a-plate fundraiser
dinner for President Obama at Mayer’s Palo Alto home.
And late last year, Mayer became an internet meme after she
was filmed dancing to an MC Hammer beat in a YouTube video made to support San
Francisco Mayor Ed Lee’s election effort.
*For more Fin24 stories, check out our
Facebook, Twitter and Google+ pages.