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Yahoo's big mistake
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I visit Yahoo's website multiple times each day. I check e-mail, stock quotes and read the latest news headlines. But what I rarely do is use the company's Internet search function. For that I zip over to Google, which is by far the Internet's top search engine.
Essentially, Yahoo is becoming more and more of a media company that delivers news and content. Google, meanwhile, continues to extend its advantage in the paid search sector. This is not a good trend for Yahoo shareholders, and that's why many of them are upset right now about the company's decision to not accept the $47 billion take-over bid from Microsoft. Shares of Yahoo have slumped badly since, and there's no clear catalyst on the horizon that I can see that will spur the stock to move higher.
In time, Yahoo could be proven correct. If the company can snag a larger portion of the lucrative paid search sector, then revenue and profits should expand (it should be noted that a Yahoo-Microsoft combination could have indeed accomplished that goal, but that's beside the point). Google appears poised to become the default search engine for millions of Internet users, while Yahoo's portal model feels increasingly dated.
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