Let me be one of the many in the blogosphere to state publicly that I was quite happy to see the rumors flying on Jerry Yang’s apparent imminent departure. While it looks to have since been proven false (ah well), the fact that this is even coming up is a good thing.

Really, what good has come of Yahoo lately under Yang’s leadership? He messed up what could have been a very profitable merger with Microsoft for his shareholders, opting to align itself with Google in what looked more like a poison pill rather than looking out for the best interests of his company.

Well guess what. The Google-Yahoo deal is dead. So while Yang could have secured a decent deal with Microsoft that would have benefitted all, his company is now once again left by it’s lonesome self, with its poor stock performance and rumors continuing to circle that his company may be on the ropes.

The Microsoft deal would have put a value of $31 per share or about $44.6 billion on the company. Now with the stock price sitting at around $14, more than halving the value of the company, nobody in their right mind will pay anywhere close to what Microsoft offered back in February.

In search, the story isn’t much better. According to Net Applications, its share of search queries has fallen from 12.2 percent in January to 10.5 percent this month worldwide.

I can only see two options really for this company. Either it gets rid of Jerry Yang, who is far past his prime, or it swallows its pride and runs into Microsoft’s waiting arms. Ballmer can say all he wants: if Yahoo comes a-knocking, there’s no way in you-know-where that he will say no.

In search, the only way that there is to catch up to Google is consolidation. It’s going to happen sooner or later.

 
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