> I worked at Yahoo! when this was going on As did I > I'm amazed share holders didn't sure Jerry Yang and the board for avoiding the sale. There was a lawsu

> I worked at Yahoo! when this was going on As did I > I'm amazed share holders didn't sure Jerry Yang and the board for avoiding the sale. There was a lawsuit: https://www.seattletimes.com/business/yahoo-settles-lawsuits-over-microsoft-bid/ https://www.seattletimes.com/business/yahoo-settles-lawsuits... > Yahoo had very little of technological value and was actively trying to destroy its own search business amongst other properties at the time. I'm not sure what you are referring to there. There was a lot of investment going on in search at the time. Certainly, critics (including me) felt it was maybe not the right investment, but "actively trying to destroy its own search business" doesn't ring true. > They really were in a prime position and bungled it extremely badly, I think they had maybe 20% of the search market at the time. 20% market share was unfortunately, a very weak position that was deteriorating pretty rapidly. The network effect ensured that the search business would continue to reward the dominant player dramatically more so than the smaller players, even if the smaller players had a technically superior product, which was what Bartz was getting at. "She made it very clear the equation for success was money spent === great search engine results, ignoring how Google came into being in the first place." That's not ignoring how Google came into being, and the "money spent === great search engine results" isn't exactly what she said either. There's a reality that the business had evolved (not accidentally) to the point where barriers to entry were increasingly higher and more costly and the rewards disproportionately went to the dominant players. It is typical Harvard Business School stuff, because it's not at all an unusual circumstance in business. > It still feels like a wasted opportunity to me, it seems so weak to just throw your hands up in the air and say it’s too hard to make your extremely successful search engine better. If you'll recall, they made the engine better; it didn't matter. Less than a quarter of the market would switch to another engine even if you gave them absolutely the worst results, and smaller differences in search quality impacted the behaviour of less than 10% of the market. Hell, there was still a ton of traffic going to Alta Vista despite that engine no longer being different from Yahoo's. Meanwhile the advertisers hugely favoured larger market share, and the consequently more efficient market yielded huge marginal rewards in terms of quality and profit. The search engine battle had largely already been lost by then; it was largely lost several years prior (arguably as far back as Google's AOL deal). The opportunity wasn't "wasted": they'd thrown pretty much everything at it, and come up short. To this day, Google still has a dominant market share, despite a plethora of would be competitors. Sure, there is a possibility for a market disruption to change the game, but in a decade and a half, that has yet to emerge, so if you'd bet on game changing disruption in 2008 (and many investors did), from an investor's perspective, you'd have lost that bet.