Losing
its lead in Internet traffic and ad revenue along with its chance to win the
search market, Yahoo aims to reinvent itself. But with a slowing economy
and downward forecasts for earnings, how bad are things for Yahoo? That could
depend on Microsoft’s plans to buy the struggling Web portal.
The exclamation point at the end of its logo once symbolized Yahoo's synonymity with the exciting opportunities of the Internet. Originally dubbed "Jerry's Guide to the World Wide Web," Yahoo defined itself as the portal to the digital world. Missteps and missed opportunities caused it to lose out on some key opportunities—including an acquisition of rival Google—which is now costing it Web traffic and advertising revenue and raising questions about its viability. Under pressure, Yahoo is trying to reinvent itself as a true multimedia company, investing millions of dollars in new technology and products that could restore its former glory.