Usually Yahoo surprises aren’t exactly a good thing, particularly when CEO-related. Regardless how the company’s latest stunner bears out in the long run, Yahoo shocked the industry on Monday (July 16) afternoon when it announced that high-profile Google executive Marissa Mayer will take the reins as CEO starting Tuesday.
“Wow,” said Vik Kathuria, managing partner of corporate strategy and digital investment at GroupM/MediaCom, upon hearing the news. “I thought [interim CEO] Ross [Levinsohn] had the job. I think everybody did.” While Kathuria admitted to a bit of bias given Levinsohn’s media and advertising reputation, he called the appointment a “great hire” for Yahoo.
“From where I sit, what’s interesting to me is they really need someone who’s going to focus on the core user experience,” Kathuria said. “Having Marissa at the helm now means a return to the core focus on the Yahoo user, not only on the homepage but also in their key verticals like finance, entertainment and sports. She is an engineer by training.” The first female engineer hired by Google, Mayer resigned as that company’s vp of local, maps and location services on Monday, according to The New York Times, which first reported the news.
B. Riley analyst Sameet Sinha said he was “totally surprised that Yahoo would hire somebody of this quality.” Between her computer science Ph.D. from Stanford University and 13-year tenure at Google—during which time she played a major role in the development of search and the Google homepage—Mayer brings serious technology chops to the struggling online portal. While analysts had said that Yahoo should appoint a credentialed media executive, Sinha said Mayer may lack Levinsohn's media experience but she is well versed in the monetization of media from her time working on search at Google.
Plus Mayer could help resolve the engineering exodus Yahoo has been suffering. “If I’m an engineer at Yahoo, I’m going to be cheered by [the hire],” he said. “Finally we have an engineer—a real engineer and Ph.D. from Stanford no less—at the top, so obviously the engineering culture will foster here. I’m sure she will able to bring on some of the people who worked under her at Google and pull them to Yahoo.”
Of course, Mayer isn’t the first product person Yahoo’s tapped as CEO this year. Scott Thompson took the job in January after serving as president of PayPal, and six months, 2,000 layoffs and a resume scandal layer...well, obviously things didn’t work out. Yahoo has been toeing between being a technology company and/or a media company for years, but just because it’s picked from the tech side again doesn’t mean it’s shirking its media identity. “Ultimately every Internet media company has to be a technology company first, and Marissa obviously epitomizes that,” Sinha said.
While Yahoo has cleared up questions about its top position, the fate of interim CEO Ross Levinsohn is uncertain. When word spread earlier this month that he and Hulu CEO Jason Kilar were the top candidates to replace Thompson permanently, investor analysts lobbied for Levinsohn to get the nod, noting that Yahoo could risk losing him altogether.
During his two-month stint as interim CEO, Levinsohn had sown up content deals with CNBC, Spotify and Clear Channel, hired former Admeld CEO and Google exec Michael Barrett as chief revenue officer and amended, even strengthened, ties with Facebook. Of course Mayer was renowned for her ability to attract and keep talent while at Google, so she could very well find a way for Levinsohn to remain, whether or not that be in his former role as the company’s media head. But then again, there’s talk that Hulu will soon be looking for a new CEO.