Yahoo! lives up to its name: It laid off 2,000 of its 14,000 employees today, with more to come


Last week, Kara Swisher of AllThingsD reported that Yahoo would start laying off thousands of workers this week and begin a big restructuring effort next week. It looks like she was right. Multiple sources are reporting that Yahoo, one of the Internet’s oldest companies, is beginning its massive purge today by cutting about 2,000 employees from its roster of 14,000. The layoffs will affect every division of the company, but the local businesses, product research, and marketing sections will be hit the hardest. And more layoffs are likely to come in the days ahead. 

Yahoo is trying to refocus itself around the couple things it seems to have been doing right in the last few years: media and advertising. Yahoo Web sites still attract hundreds of millions of visitors per month, but its still bleeding money due to its many other attempted ventures over the years, which include many Web products, Yahoo Labs, Yahoo Messenger, Flickr, Yahoo Mail, a search engine, and other endeavors. Recently, Yahoo let go a number of its New York R&D engineers, many of which were quickly scooped up by rivals. 

If you’re looking for a man responsible for these new layoffs and the coming restructuring, it’s Yahoo’s new CEO, Scott Thompson. He was hired in January and knows money. Thompson was the head of eBay’s PayPal division from 2008 until he made the switch to try and rescue Yahoo. Before he was hired, there was a big chain of leadership failure at Yahoo. In September 2011, CFO Tim Morse was given the CEO position temporarily after the board fired Carol Bartz and before that Yahoo co-founder Jerry Yang even stepped in to act as chief, though that too, did not end well. Yang left the company completely in January.

yahoo-facebookWill layoffs help Yahoo? It depends, but Scott Thompson seems to be the first CEO that’s bold enough to do something major, which is promising (and quite sad for 2,000 employees). Though not all his ideas are great. The company’s recent attempt to squeeze money out of Facebook through patent lawsuits appears to have backfired. Facebook is now counter-suing Yahoo

With big media companies like AOL nipping at it and other Web companies constantly trying to top its core products like Mail, Yahoo has to get back on the saddle and begin pushing forward again if it hopes to survive. 

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