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An Open Letter to Jerry Yang: It's over, Buddy

Don Reisinger has written an open letter to Yahoo CEO Jerry Yang urging him to do what's right for his company. Will he?

Jerry Yang
Go count your billions and get out of the way! Yahoo

Dear Jerry,

Whew, things aren't going so well lately, huh? First, the company you founded and love was being pushed into turmoil by some executives, like your old buddy Semel, who had no idea how to run an organization. And then, to add insult to injury, you found a company that was marked with issues, like over-spending and too many acquisitions that caused your beloved organization to become a bloated mess.

But then, you took over and promised your shareholders and employees a new culture and a new Yahoo that would change the Internet and adapt far better to the changing needs of your customer base.

And while you succeeded in reducing expenditures and changed the culture of Yahoo by putting it on the right track with an open source initiative with your mobile products and a vastly improved home page, something much larger than even you came along and spoiled your party. And it's that organization -- Microsoft -- that will lead to your downfall unless you realize that not even you can save the company you founded.

It's time to move over, buddy.

What? You disagree? Well, certainly I can understand why you would, but have you taken a thorough look at what exactly is going on?

First, Microsoft offers you a 67 percent premium on your floundering stock price. After taking a weekend to mull the offer, you sent out a cryptic message explaining your reasons for why you wouldn't take the deal.

Your conclusion? "Yahoo's management...believes that Microsoft's proposal substantially undervalues Yahoo and is not in the best interests of [its] stockholders."

"More importantly," you told your stockholders. "I want you to know that your board is continuously evaluating all of Yahoo's strategic options in the context of the rapidly evolving industry environment, and we remain committed to pursuing initiatives that maximize value for all our stockholders."

Really, Jerry? Is that true? Hey, I'm not one to doubt your intentions and I honestly believe you want what's best for Yahoo, but if you truly do, why not listen those shareholders you value so much?

After all, aren't those shareholders the same people who have already started lawsuits urging you and the board to accept Microsoft's offer for the good of the company?

On top of that, aren't those shareholders the people who theoretically own your company and thus, have the power to tell you what they want out of their company?

Sure, you own a considerable piece of the pie still, but I think there's more to this story than your distaste for Microsoft and the rancid thought of your beloved company heading into the grimy hands of Steve Ballmer.

And then there's this other issue that you don't want to talk about -- a proxy fight. What if Microsoft succeeds in obtaining support from those people that are more likely to acquiesce to its demands and you're the only person guarding the door against a mob? How do you handle that?

Jerry, I can appreciate where you're coming from and understand that you're trying to stay true to your company. But in the end, you're standing up to a foe that is much bigger and more powerful than you and even those who should be on your side are already counting their cash.

It's over, Jerry. It's time to move on and do what you want elsewhere. If you don't, this is going to get much worse and that company you're trying to protect could very well be destroyed.

Do what's right for Yahoo, Jerry: step aside.