Marissa Mayer says Yahoo is about 'entertaining'

SAN FRANCISCO -- When critics talk about Yahoo and the woes it has faced in the last several years since it helped pioneer search in the Web 1.0 era, they often talk about Yahoo's inability to decide what kind of company it is. What does Yahoo do?

On Tuesday, CEO Marissa Mayer gave an answer: Entertain.

"When you look at, 'What is Yahoo's core verb?' Some companies aim to connect. Some companies aim to organize," Yahoo CEO Marissa Mayer said during a "fireside" style chat with Salesforce CEO Marc Benioff at the Dreamforce conference here. "Us, it's been around entertaining."

It's still not a cut and dry answer, but it at least illuminates what Mayer has been doing at the company thus far. It also jibes with recent announcements that suggest the company has doubled down on content. Yahoo brought on veteran New York Times technology columnist David Pogue to lead consumer tech coverage. And there have been reports that the company has been in talks with Katie Couric and Ryan Seacrest.

Of course, entertainment isn't just media. Benioff asked Mayer about the importance of design at the company, and Mayer said it relates back to the mission to entertain. "When you have billions of users coming to the Web site each month, you really have to have thought through the experience," she said.

Still, contrary to other companies like Apple -- where Steve Jobs said the chief designer had the most operational power at the company besides him -- Mayer thinks design shouldn't be deified. "I'd argue it's important not to lead with design, but for design to be part of the product," she said. Then she told a story about a friend at a failed pre-bubble tech company that designed products that were "usable, but not useful." To wit, Mayer said earlier in the conversation that the position of senior vice president of design in her executive team has not yet been hired.

Mayer also touched on a number of other aspects of Yahoo's business and culture: In an attempt to walk the walk of "mobile first," she's beefed up the number of people working on mobile products from about 40 to 60 to almost 400. She also instituted a policy called "PB&J," or "process, bureaucracy and jams," as a system for working through conflicts and problems.

Mayer has been the subject of much attention since she took Yahoo's top job in July 2012. Her efforts at turning around the troubled company have had their share of fits and starts. Among them have been controversies over getting rid of the company's work from home policy and a bell curve employee rating system.

Yahoo on Tuesday also announced that it would increase its shares buyback authorization by $5 billion and said that it plans to offer $1 billion in convertible notes. The company said part of the proceeds will go to things like possible acquisitions or strategic investments. Indeed, under her watch, Yahoo has already acquired some 20 startups, including blogging platform Tumblr for $1.1 billion.

Yahoo also hasn't been immune to the scrutiny facing giant tech companies in the wake of detailed leaks of government surveillance by former National Security Agency contractor Edward Snowden. Last month, the Washington Post reported that the NSA and its British counterpart the GCHQ had been infiltrating links to Yahoo and Google data centers. In response, Mayer wrote in a blog post Monday that the company was taking steps to encrypt the flow of information between data centers.