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Comment by crabapple | Hacker News Reader

Consider this: Yahoo is #1 in the WORLD based on traffic (Alexa.com). But nobody will touch their stock? The writing is on the wall. Like I said, there is a downward trajectory there. Good companies find a way to leverage a #1 ranking into dollars and dominance.

to be fair, they have in a sense.

the company is profitable. they have cash in the bank. but the writing is on the wall, google has become completely dominant in ads. yahoo has tried to reverse this but google has just taken more share. web ads are a winner-take-all economy...it doesn't look good for anyone going head-to-head with google

yahoo won't go under, but its days as an independent company are likely numbered

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I think there's an obvious business model. It's "fire everyone." #1 in traffic, forget all the web 2.0 stuff, mindshare, and cut costs to the bone. Use the profits to concentrate on more cost cutting, more efficiency. Concentrate on being cheaper at everything. Where stuff is free, use the cost savings to show less ads. In business they call this strategy "low-cost provider."

Would that not be the way to guarantee that they never do anything innovative ever and let other people eat away at there market cap?

How would that be different than what they were doing previously?

Oh boy! Your time at Y! was that bad eh? ;-)

You have no idea.

You can be innovative about cost-reduction.

That must be the most retarded thing I've ever read. If they cost costs everywhere, then where will new income come from?

Ask Walmart. Or Toyota. Or any other number of companies who've used cost as a competitive weapon.

Yahoo is falling behind because it's stagnant, not because its cost are too high. Yahoos products are mostly free, and it's a very different industry from retailing or machine manufacturing.

Yahoo does not need to cut costs. Cashflow is fine in the company. Cutting costs would be silly at this junction - it does nothing at all to address the problem.

It's like a guy who gets his leg cut off, and your solution is to bind the leg. Yes, that helps, but he'll still die if you don't actually fix the wound.

I'm an advertiser and I've spoken at length with Yahoo's display advertising department. Their costs are too high.

Search ads on Yahoo are great, however.

I didn't know "suicide" was a business model.

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