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COMPANY BACKGROUND
Yahoo! Began as a student hobby and evolved into a global brand that has changed the way people communicate with each other, find and access information and purchase things. The two founders of Yahoo!, David Filo and Jerry Yang, Ph.D. candidates in Electrical Engineering at Stanford University started their guide in a campus trailer in February 1994 as a way to keep track of their personal interests on the Internet. Before long they were spending more time on their home-brewed lists of favorite links than on their doctoral dissertations. Eventually, Jerry and David’s lists became too long and unwieldy, and they broke them out into categories. When the categories became too full, they developed subcategories … and the core concept behind Yahoo! was born.
The Web site started out as “Jerry and David’s Guide to the World Wide Web” but eventually received a new moniker with the help of a dictionary. The name Yahoo! is an acronym for “Yet another Hierarchical Officious Oracle,” but Filo and Yang insist they selected the name because they liked the general definition of a yahoo: “rude, unsophisticated, and uncouth.” Yahoo! Itself first resided on Yang’s student workstation, “Akebono,” while the software was lodged on Filo’s computer, “Konishiki” – both named after legendary sumo wrestlers.
Jerry and David soon found they were not alone in wanting a single place to find useful Web sites. Before long, hundreds of people were accessing their guide from well beyond the Stanford trailer. Word spread from friends to what quickly became a significant, loyal audience throughout the closely-knit Internet community. Yahoo! celebrated its first million-hit day in the fall of 1994, translating to almost 100 thousand unique visitors.
Due to the torrent of traffic and enthusiastic reception Yahoo! was receiving, the founders knew they had a potential business on their hands. In March 1995, the pair incorporated the business and met with dozens of Silicon Valley venture capitalists. They eventually came across Sequoia Capital, the well-regarded firm whose most successful investments included Apple Computer, Atari, Oracle and Cisco Systems. They agreed to fund Yahoo! in April 1995 with an initial investment of nearly $2 million.
Realizing their new company had the potential to grow quickly, Jerry and David began to shop for a management team. They hired Tim Koogle, a veteran of Motorola and an alumnus of the Stanford engineering department, as chief executive officer and Jeffrey Mallett, founder of Novell’s WordPerfect consumer division, as chief operating officer. They secured a second round of funding in Fall 1995 from investors Reuters Ltd. and Softbank. Yahoo! launched a highly-successful IPO in April 1996 with a total of 49 employees.
Today, Yahoo! Inc. is a leading global Internet communications, commerce and media company that offers a comprehensive branded network of services to more than 345 million individuals each month worldwide. As the first online navigational guide to the Web, www.yahoo.com is the leading guide in terms of traffic, advertising, household and business user reach. Yahoo! is the No. 1 Internet brand globally and reaches the largest audience worldwide. The company also provides online business and enterprise services designed to enhance the productivity and Web presence of Yahoo!’s clients. These services include Corporate Yahoo!, a popular customized enterprise portal solution; audio and video streaming; store hosting and management; and Web site tools and services. The company’s global Web network includes 25 World properties. Headquartered in Sunnyvale, Calif., Yahoo! has offices in Europe, Asia, Latin America, Australia, Canada and the United State.
SWOT ANALYSIS
Strengths
1st worldwide internet portal
Incredible technology strength in its people Yahoo! has over 350 million users of its services and solutions.
Powerful marketing company, with a very well known brand name.
International business presence
Opportunities
Up selling to existing customer base
Attract new customers
Develop services for non-pc internet access devices
Develop compelling products
Online payment service
Weakness
Dependency on AD revenue
Dependency on its partnerships with telecommunications
Lack of humanity service
Lack of direct-billing relationship with users, as does AOL, MSN
No solution for online shopping directly payment method( such as paypal, verify by visa or froogle)
Threat
Customers and market expectations
Loss of market
Financial sensitivity
Competitors such as AOL, Google and many others
Dependence upon communications companies for all internet access
Porter’s diamond of national competitive advantage
(CHINA)
Demand conditions
Size of market
1. 1.3 billion population purchasing power
Sophistication customers
1. customers require excelsior service
2. providing service without time and location limit
Media exposure of products
1. High percentage of website clicking rate
2. Advertisement tied with
target file while downloading
Factor conditions
Natural resources
1. potentials labors market
2. Million of companies can provide technique support, facilities, and maintenance service
Education and skill levels
1. lower education level for majority people
2. lack of advanced skill
Wage rates
1. lower wage
Company strategy, structure, and rivalry
Number of companies in one industry
1.Various internet service inc. in china
Intensity of competition
1. Google in china
2. MSN china
Public or private ownership
1.under the condition of market economic system, there have more and more privately ownership company exist in Chinese market
Related and supporting industries
Existence of suppliers clusters
1. China Mobile ,China Unicom and CNC can provide the internet access and sever
Strengths
Yahoo!’s Overture is a tremendously profitable Internet advertising business. It focuses on affiliate advertising for large adverting accounts, in the same way as Google’s Ad sense programmer. This is an important income stream for Yahoo!.
Yahoo! has over 350 million users of its services and solutions. This makes it a very powerful marketing company, with a very well known brand. Some reports indicate that is it is the most popular website in the World.
A key long-term strength is Yahoo!’s international business presence. As the Internet expands and it is adopted by more nations the opportunities for Internet brands begin to emerge. Yahoo! is well placed to take advantage of these opportunities with its strategic business units in Asia, Europe and Australia.
The Yahoo! Directory is an original source of structured information. It has built over the last decade, and unlike mainstream search engines, its content is moderated (i.e. sites are vetted before their inclusion).