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TheStreet Open House

Yahoo! Is Out of Reasons for Not Paying a Dividend

Stocks in this article: YHOOAAPLGOOGMSFTIEP

Google continues to run circles around Yahoo!, although Yahoo! Ad Manager is quickly slowing the pace Google laps Yahoo! in selling ads. Yahoo! Ad Manager is a few years late to the game, but at least smaller advertisers are able to self-serve ads into the Yahoo! network. How many know they can do this is another question altogether.

The piece, and this is critical, is the ability for Web sites to sell ads into the Yahoo! network. If Yahoo! wants to take a piece of Google's virtual monopoly and highly lucrative small-site publishing ad network (and Yahoo! should), small Web sites need to easily enter and navigate Yahoo!'s ad network.

So far, it appears Yahoo! has its work cut out. I went to sign up my personal Web site and at the end of a longer than necessary process to find out if I would be approved, I finally reached a page that stated:

"Due to continued high volume of interest, we currently have a backlog, and hence it may take us up to 1 week to get back to you on the status of your invitation request."

"PLEASE NOTE

(1) We are issuing a limited number of accounts daily. Due to the extremely high volume of interest in the program, we currently have a backlog, and hence it may take us up to 1 week to get back to you on the status of your invitation request.

(2) Each website that you have submitted is individually reviewed by us for approval. There are several factors including advertiser demand, that determine which websites get approved and the order in which we process invitation requests. We will do our best to get back to you as soon as possible."

So my first experience working with Yahoo! is that it may take a week just to find out if it will take my site as a publisher. Apparently, Yahoo! fails to understand that between now and a week from now I will have already signed up for Google AdSense and have the appropriate code to display their ads.

If I do become approved for Yahoo! ads, why in the world would I then take the time to change the Google HTML code to replace it with Yahoo! code? There's an old saying in business that if you don't have the time to take care of your current customers, how will you have time to take care of more? It's as true today in an online world as it was when it was coined.

Yahoo! has never understood that basic rule of business, and after almost two years of Mayer leading it appears it still doesn't. That's why I think the company's best use of capital is to pay a dividend and use its resources to fix what it already has instead of further expansions. The market has clearly voted that it has all but totally lost faith.

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