Yahoo ReOrg Is Official

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Yahoo has announced its anticipated reorganization. As expected executives Hilary Schneider and Ash Patel are consolidating power under president Sue Decker. All product development will come under the responsibility of Patel, a Yahoo veteran and Yang loyalist. Schneider will take over all the advertising sales teams across the company. A third “Insights Strategy” team has also been formed to centralize strategy. Nobody has yet been named to head up that group.

This reshuffle follows mass defections and a shakeup of its upper ranks. Wall Street is underwhelmed. The stock is down nearly 3 percent today (granted, on a terrible day for stocks overall).

The company is also announcing a new cloud computing group and new responsibilities for three search executives—Venkat Panchapakesan, Tuoc Luong, and David Ku— who are filling the hole left by former EVP of engineering Qi Lu.

Here’s the press release:

Yahoo! Announces Realignment to Support Core Strategies

Centralizes Audience Product Development; Forms New U.S. Region;

Realigns Technology Organization

SUNNYVALE, Calif., Jun 26, 2008 (BUSINESS WIRE) — Yahoo! Inc. (Nasdaq:YHOO), a leading global Internet company, today announced changes to its organization aimed at improving its products, technologies and execution. The moves support its strategy to be the starting point for the most users, the must-buy for the most advertisers and the platform of choice for developers.

Key elements Yahoo! announced are the centralization of consumer product development to enhance the company’s ability to release products worldwide; the creation of a U.S. region focused on bringing products to market for users, advertisers and publishers; formation of an insights strategy team; and enhancements to the technology infrastructure to optimize the use of data and improve coordination between product and engineering teams.

“These moves accelerate the ability of our deep and talented team to build great products, grow our audiences and improve monetization globally,” said Jerry Yang, CEO. “They are designed to put us in an even better position to leverage our leading global audience and capture the opportunity we see in the convergence of search and display advertising.”

Business and Product Changes

The company is creating three new teams that will report to President Sue Decker. An Audience Products Division will assume responsibility for companywide product strategy and product management. It will be led by Ash Patel who previously managed the company’s Platforms & Infrastructure group. A U.S. region with accountability for all go-to-market activity in the U.S. will be led by Hilary Schneider, who previously headed the company’s Global Partner Solutions group. Finally, an Insights Strategy team will assume responsibility for centralizing and executing a common strategy for the use of data and analysis across Yahoo!. The company plans to name this group’s leader within the next few weeks.

“The changes we’re making today will help deliver superior global products for users and enable faster and better decision-making,” said President Sue Decker. “This is a logical next step in light of our success last year in moving to a more centralized approach to developing world-class marketing products. We have planned these changes deliberately over the past several months to clarify responsibilities and to capitalize on the scale advantages while allowing for fine tuning to meet local market needs.”

Technology and Infrastructure Changes

Yahoo! is making changes to its technology organization, led by Chief Technology Officer Ari Balogh, to better position the company to execute on its strategic priorities. Principal changes are developing a world-class cloud computing and storage infrastructure; rewiring Yahoo! onto common platforms; and creating a stronger partnership between product and engineering teams.

“Since my arrival at Yahoo! earlier this year, we’ve carefully evaluated the best possible configuration of our technology group to support our business strategies,” said Balogh. “I’m excited by the depth of our team which–combined with the talent we continue to recruit–will execute even better under this new structure.”

In order to expand its cloud computing capabilities, the Company will form a Cloud Computing & Data Infrastructure Group, charged with developing a computing infrastructure that balances scalability with cost effectiveness. It will move all consumer-facing platform teams to the Audience Technology Group, led by Venkat Panchapakesan. In addition, it is putting new leadership in place behind Yahoo!’s search group, naming Prabhakar Raghavan to direct search strategy and Tuoc Luong as the interim leader of the search product team. Both Prabhakar and Tuoc will also continue in their roles as the leaders of Yahoo! Research and Search Engineering respectively. In addition, David Ku will lead the Advertising Technology Group within Search.

Yahoo!’s Marketing Products Division, Connected Life and Corporate Marketing groups will continue to operate as they do today.

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