Jim Armitage: A new Dawn for Yahoo, so now it must wake up

Outlook Here's a question for Dawn Airey, the former Channel 5 boss who's just accepted the job of European boss at Yahoo. My internet-savvy 10-year-old has never heard of your new employer: what are you going to do about it?

I would not usually drag my daughter into this column, but she and her friends represent the biggest challenge to this once-great internet brand: how to make it relevant to the next online generation.

With AOL, MySpace and arguably Microsoft, Yahoo is the epitome of the first wave of internet giants entirely eclipsed by newcomers: Google in the world of search, Facebook and Twitter in social media and YouTube in video. It is a dinosaur whose bones will be excavated by MBA lecturers and held up in lessons on the theme of "innovate or die".

Marissa Mayer's arrival from Google as chief executive last year has done a lot to stem falling morale. Enders Analysis' Ian Maude, says Yahoo staff are more motivated, upbeat and aggressive than they have been for years. And when was the last time a Yahoo senior executive got a spread in Vogue, as Ms Mayer did this month?

But, Vogue aside, it's hard to see how the Mayer-Airey axis can make Yahoo relevant and sexy again. Yes, Ms Mayer has accelerated the launch of apps (Yahoo Weather is really very good – check it before making your bank holiday plans). And she has rightly pushed hard into mobile, a one-way street for internet traffic growth.

But, with so many hipper businesses to join in Silicon Valley and other global tech hubs, Yahoo will struggle to hire the best programmers and engineers to create the next internet success. So the only way it will be able to create such new tech is by overpaying for acquisitions, as with the $1bn takeover of Tumblr in May.

Meanwhile, display advertising revenues continue to shrink. Ms Airey will surely employ her enviable contacts book to bring advertisers over from TV to Yahoo's video offerings. But they will ask her, just as my daughter asked me: "What is Yahoo for?"

I'm afraid there is still no real answer to that.

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