Yahoo CEO Jerry Yang's second hundred days could, conceivably, be worse than the first. He and general counsel Michael Callahan are going to Congress to answer to accusations that Callahan lied under oath about Yahoo's role in Chinese censorship. Sounds like even more fun than getting hammered by Wall Street analysts in a conference call, right? Here's why Yahoo's top brass is set to feel new pain over this old case.
The hearing, called by Bay Area congressman Tom Lantos and scheduled for November 6, will focus on the case of Shi Tao, a Chinese newspaper reporter and editor, who was arrested in his home after anonymously blowing the whistle on a government crackdown on media and democracy.
According to Congressman Chris Smith, a Republican from New Jersey who no doubt uses Google, Chinese police only managed to discover Shi Tao was the anonymous blogger after asking Yahoo to provide information about his email account, including his IP address, log-on history and the contents of his email over several weeks.
But in February 2006, Yahoo general counsel Callahan said Yahoo had " no information about the nature of the investigation."
Smith, however, says he's got proof police had written Yahoo specifying that they sought evidence about Shi in a case of suspected "illegally providing state secrets to foreign entities." He says that charge is frequently invoked against political dissidents in China, and officials in Yahoo's subsidiaries should have known that.
This is, of course, a no-win situation for Yahoo. Yang, at least, has more progressive views than former CEO Terry Semel, who famously admitted he would have complied with Nazi Germany's laws. But there's little upside here, however Yang responds. Yahoo no longer even owns its Chinese operations, having swapped them for a stake in Alibaba. It's an unneeded distraction, about a sad incident that happened far away from headquarters, when Yang ought to be focusing on executing Yahoo's turbulent turnaround at home.