Levinsohn will be in charge of a company struggling with administrative chaos, industry position and growing competitors, so even if the post is only temporary, he certainly has his job cut out for him.
“I think Yahoo needs right now someone who has a strategic vision of where the company needs to go and the ability to communicate that vision internally and externally,” said Ezra Gottheil, an analyst with Technology Business Research. “I don’t see anything in Mr. Levinsohn’s background like that.”
Levinsohn took on the top spot at Yahoo after embattled Scott Thompson stepped down over the weekend. Embroiled in an investigation about the legitimacy of his academic credentials and reportedly beginning treatment for thyroid cancer, Thompson left after only five months at the company.
Also Monday, All Thing D cited unnamed sources who said Yahoo’s board will claim that Thompson left the company “for cause,” and will therefore be ineligible for a hefty severance package. Under the company’s “Code of Ethics and Yahoo! Policies,” the erroneous resume and botched filing with the U.S. Securities and Exchange Commission should be enough to enable the company to keep what would have been his severance in its own pocket.
Levinsohn will run the company’s day-to-day operations at time when Yahoo has been fighting to regain its position as a top-tier Internet company alongside online leaders Google and Facebook. He joined Yahoo in October 2010 and was executive vice president of the Americas and head of the company’s global media.
Before then, he developed a reputation for online ad savvy while working at News Corp. from 2000 to 2006. While there, he moved from running FoxSports.com to becoming president of Fox Interactive Media, leading Rupert Murdoch’s far-reaching online efforts. Levinsohn is also known as one of the people who put together the deal for News Corp. to buy Myspace in the summer of 2005.
Jordan Rohan, an analyst with Stifel Financial, an investment banking firm, said he sees Levinsohn’s rise at Yahoo as good for the company.
“Ross Levinsohn, in our view, is an excellent choice for interim CEO and will help to calm the troops and focus the company. After all the drama at Yahoo over the years, that is exactly what the doctor ordered,” he said.
However, Patrick Moorhead, an analyst with Moor Insights & Strategy, said the appointment could be a mixed bag.
“Yahoo didn’t have too many choices for interim CEO. As the goal is typically just to not mess things up before the CEO arrives, Levinsohn is a good enough fit. People shouldn’t look to closely into the fact he’s a deal guy and the potential to chop up Yahoo into smaller pieces,” he said.
The first thing Levinsohn needs to do is to calm the waters at Yahoo and give employees a sense that better times are coming, Moorhead said.
“He needs to provide reasons why the Yahoo ship isn’t sinking. Talent is fleeting, so sustaining packages need to be put in place for the top talent. Levinsohn also needs to set up a strategic council to get them on a path to identify who they are and where they want to win. Then let strategy follow,” he added.
Rob Enderle, an analyst with the Enderle Group, agreed Levinsohn need to bring confidence back to the troops.
“He has better industry skills than Thompson, but he’s very light in terms of CEO experience and skills. He’ll need to get the employees comfortable with the changes, and change the top executive staff into one that better fits his skill gaps and can execute against this strategy,” Enderle said.