Abstract
There are more Yahoo! Mail users around the world than two times the population of Mexico” (Yahoo! Website, 2008).
One cannot deny the success of Yahoo! over the last decade. However, the reason why Yahoo! is catching a lot of media attention today does not lie in its success but more on its uncertain future. Will Microsoft take over Yahoo!? Will Yahoo! privilege a partnership with Google or AOL? Whatever decision Yahoo! takes, it will certainly have an impact on the whole Internet industry. Therefore, it is worthwhile and challenging to carry out a strategic analysis of Yahoo!. That is the reason why we choose Yahoo!.
In the first part of this paper, we will briefly give the company's overview; we will explain its history and the strategic issues it faces today.
In order to understand Yahoo!'s position, we will present an analysis of its external environment through the PESTEL and the MICHAEL PORTER's 5 FORCES models. We will also focus on the internal issues using the SWOT and the ‘Strategic Drift' analyses.
Finally, we will bring to light the different strategic directions that Yahoo! can consider. More precisely, we will analyze the opportunities of a potential Microsoft takeover and see how it impacts Yahoo!'s BCG MATRIX. Thanks to the ‘Cultural Web' model, we will also discuss the cultural compatibility of the two companies. We will then turn to other strategic directions that Yahoo! can take. We will especially focus on a partnership with Google and an acquisition of AOL.
