Marissa Mayer Struggles to Give Yahoo! an Identity Beyond Alibaba

NEW YORK (TheStreet) -- No one doubts Marissa Mayer is good at her job. Prior to her being installed as Yahoo!'s (YHOO) CEO, that position was a turnstile of failed promises. But now she is under increasing pressure to come up with a strategy for the company as Alibaba readies its initial public offering.

Mayer's arrival at Yahoo! spurred an immediate recovery. Yahoo! is no longer a laughingstock. As for the stock itself, currently trading around $35.50, you'll be hard pressed to find a stronger turnaround story, even with the shares down 12% for the year to date.

Still, the company is light years ahead of where it was just 12 months ago, up 33%. Since Mayer's arrival, shares have soared 155%.

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But they won't go much farther without some catalysts. The honeymoon's over. We're approaching Mayer's two-year anniversary. It's time to change the narrative of "Yahoo! will be okay because it owns part of Alibaba."

Sure, by virtue of its 24% stake, Yahoo!'s cash situation will improve once Alibaba files its IPO. But absent a clear and comprehensive strategy, Alibaba alone is not going to drive Yahoo!'s stock.

Mayer has made a lot of moves, including the acquisition of Tumblr. There has also been speculation she is interested in Yelp (YELP). There have been talks about online video and possibly movie and music streaming.

These are markets currently dominated by Google (GOOGL), Netflix (NFLX) and Pandora (P). I'm going to guess you've heard of them.

To her credit, Mayer understands she cannot just sit idle and expect the company to grow. From where I sit, Yahoo!'s ambitions appear too scattered. Not wanting other groundbreaking end-markets like Facebook (FB), YouTube and Twitter (TWTR) to escape her grasp, she's operating with fear.

These are a few of the businesses Yahoo! could have easily dominated had it had someone of Mayer’s caliber and intuitiveness a decade ago. But times are different. Today, her job is to define what Yahoo! should be.

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