What's With Yahoo?

Once dominant search engine and Internet icon Yahoo's been having a rough time lately.  Trampled in most every market by Google, it's shifted focus from search engine, to Internet portal, to it's current emphasis on content provider (through Yahoo Sports, Yahoo News, Yahoo Finance, etc.).  That's led in part to Yahoo going through four CEOs in the last three years, the most recent in trouble for fudging his resume.
  Patrick Houston, former Yahoo executive, offered his perspective on the fall of Yahoo in an Information Week commentary.  Here's his three "Lessons" learned from Yahoo's decline

1. Don't deny your strengths - even when others do.  In other words, focus on what you do well, and competitively.  Don't wander off in search of new markets in unrelated areas.
2. Beware of Belonging to a Club.  This can be rephrased as being cautious of adopting an insider mindset, or understanding what your real business is and how it's changing.
3. When it's no longer time to persevere, don't.  This one's easy - know when it's not working and stop - get out of the market before it drags you down.

Patrick sums it up neatly - 

Yahoo (continued to hang on) to its gloried past--when it enjoyed the same stature Facebook does today... A Microsoft-Yahoo combo would have made a far better rival to Google in search, and sooner. And, paired with Microsoft's MSN/MSNBC brands, it would have been a media juggernaut, one too big to fail.

The lessons, I think, go far beyond the case of Yahoo - they're good advice for any media or technology firm in a rapidly evolving competitive environment.  Firms can no longer rest on their laurels and their traditional business models - they need to continually evaluate their markets and their role in them - shifting and adjusting as needed.

Source -  3 Lessons From Yahoo's Meltdown, From An Insider,  InformationWeek