What Little I Know…

By now, many of us have heard or read online that Yahoo! is cutting its staff numbers by at least 10% and on today’s Yahoo investors’ call, Jerry Yang, CEO Yahoo! Inc., alluded to this being one of only many cost cutting initiatives the company will endure. Nonetheless, while scouring the net this evening we came across a copy of the email Jerry Yang sent to employees yesterday to try to explain the tiring year and what led up to today’s announcement of resource reductions.

From: Jerry Yang [mailto:jerry@yahoo-inc.com]
Sent: Tuesday, October 21, 2008 2:20 PM
To: all-worldwide@yahoo-inc.com
Subject: update

yahoos,

i feel it's important for me to reach out to you after our earnings announcement, and before our all hands meeting tomorrow.

we as a company have been through a tremendously challenging year; and
managing the increasingly turbulent global advertising climate has been
an important focus for the last three months.

throughout the first three quarters of 2008, we have been
balancing between investing in our top priorities, and managing our
cost structure. beginning in september, with the help of Bain &
Co., we initiated a series of steps to determine how we can become more
efficient and productive as an organization.

we heard from you through the YEES survey, and through your
suggestions on backyard, and we've identified many areas that we all
feel we can improve upon. our productivity efforts, based in part on
what we heard from you, will involve initiatives such as streamlining
our organizational structure through reducing layers and increasing
spans of control, and eliminating redundancies. longer term structural
efficiencies include consolidating facilities, improving procurement,
and standardizing our global technology platforms.

today as part of our q3 earnings release, we said that our goal
is to reduce our current annualized cost run rate of roughly $3.9
billion by more than $400 million before the end of 2008. we are
targeting non-headcount expenses wherever possible, such as facilities
and outside services. however, because compensation expenses are the
single largest part of our costs, we anticipate a reduction of at least
10% of our global workforce by year-end.

affected employees will be notified of layoffs in the next
several weeks. we understand that hearing this news now creates
uncertainty, but we are moving ahead in a way that balances speed with
a clear focus on accomplishing what is necessary to set the
organization up for long term success. going forward it will continue
to be important for us to make the right decisions to keep our business
efficient and strong.

having layoffs is very difficult, particularly in light of all
we've experienced this year. but we don't take these decisions lightly,
and are committed to treating affected employees fairly, offering
severance and outplacement services.

the steps we are taking are not easy for us as a company, but
as we become more fit as an organization, decision-making will be
faster and it will be easier for us all to get more done and stay
focused on our strategy. these changes will also prepare us to better
deal with the macroeconomic downturn. as with previous downturns,
yahoo! continues to be a place where consumers turn for information and
communications, and is an integral part of their internet day. as the
global economy improves in the future, i certainly believe that we will
be stronger and benefit from the actions we are taking now.

as always, i thank you for all you do as yahoos.

best,

jerry