Case Study: Yahoo vs. Survivors of the Holocaust

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Case-study: Yahoo versus Survivors of the Holocaust

Summarize the case and articulate the issue(s) created by Yahoo and LICRA.

The case Yahoo versus Survivors of the Holocaust is based on a lawsuit that was made by a group of French Nazi concentration camp survivors against the website for the auction of Nazi materials and other hate related contents. The Holocaust survivors sued the company in a French court after the US based Yahoo Company refused to respond to the warnings block access to neo-Nazi contents on its US based servers. The case was targeted towards accusing CEO of Yahoo Timothy Koogle as responsible for the controversial auctioning of Nazi artifacts on the Yahoo website and if he is found guilty he faces potential incarceration in France. The case also provides information on the crash which had a negative impact on Yahoo’s performance which experienced serious decline alongside other companies in the advertising budget. In April 2001, Yahoo suffered a 42% decline in advertising revenue which led to mass exodus of the company’s leading staff and threatened to replace Koogle. The case also point out that Yahoo France which was established in 1996 as a subsidiary of Yahoo International shares similar organizational structure, same look, and tailored its contents according to local tastes. It is therefore, a shared system whereby information that comes up on the company’s US site also shows up on the French site. Thus, there was a challenge in creating a global brand that is able to adapt to suit local tastes. In this case, the challenge of a shared website has led to a lawsuit which was put together in April 2000. La Ligue Contre le Racisme et l’Antisemitisme (LICRA) and the French Jewish Students filed a lawsuit against the US based company Yahoo, for posting Nazi-era contents for sale on the company’s auction site. Yahoo responded to the lawsuit by countersuing LICRA with the US District court for violating of constitutional rights of free speech in the US. Analyze the opportunities and threats of Yahoo establishing subsidiaries in foreign countries which maintain majority ownership.

Yahoo International has developed subsidiaries that are suitable for the company image as a major MNC working in Information Technology (IT). The company is establishing subsidiaries in foreign countries around the world so that they can maintain majority ownership. For instance, in Yahoo France, the contents are tailored to fit local culture through specific contents such as sports categories focused on Tour de France, world cup soccer and the French Decathlon; while in the UK these categories focused on rugby, cricket, and equestrian events. Yahoo subsidiaries also enjoy the opportunities of majority ownership which allows the MNC to benefit from IT advancement and ease of transportation which makes it easier for the home and host country to have an effective international business. An example of the expected experience of Yahoo subsidiaries right to maintain majority ownership is similar to MTV network International, the music channel operation that reaches 1 billion people in 18 different languages and 164 countries; MTV management assures host countries that they are not in the business of exporting American culture, they point out their policy of 70% local content (Fatehi, 2008). Like MTV Network International, Yahoo International is advance in that it has developed 24 international sites in 13 languages, in each of its international markets Yahoo built independent directories of local language websites and other contents. The company yahoo is able to benefit this way by attracting 40% users from foreign countries. Nonetheless, the threats of having Yahoo in foreign subsidiaries which maintain majority ownership is that they risk having problems of hosting contents that are not culturally acceptable such as in the case of the Nazi artifacts showing up on the company’s French website and...
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