First T-Mobile, now Yahoo! In a letter to employees, the internet company has confirmed the fact that they will be laying off about 14% of their workforce, which equates to approximately 2,000 employees. Most of the layoffs will come in the products department as Yahoo struggles to move the company forward in a time where it really matters. With increasing competition, it is only natural for companies to do what is necessary to promote forward progress. Unfortunately, the 2000 layoffs are a consequence of the companies plans. The layoffs are expected to save the company on the upwards of $375 million.
What does Yahoo! plan to do with the money that is saved with the layoffs? Their goal, according to the CEO, is to build up Yahoo! so that it is stronger against its competitors. The focus will be on putting the advertisers as well as the Yahoo! users first, which is what the company says is its core goal. The plan was developed after a 60 day in-depth look at the company and its operations. In the letter to employees, CEO Scott Thompson outlines the three prominent areas that are going to be subject to rigorous overhauling: Core Media and Communications, Data, and Platforms.
With heavy hitters as their main competition – namely Microsoft and Google – Yahoo! no doubt has a lot of work ahead of them in terms of overhauling their company. While the idea of Yahoo! was golden, like the now significantly less popular MySpace, Yahoo! failed to keep and convert users. They sat idly by while their competitors grew in size and services, effectively hurting the company in more ways than one. The good news, however, is that Yahoo! is now recognizing the areas where they need to focus and if the effort is put forth, there is no reason why they cannot rejoin the ranks of their competition.
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