You're exactly right. Not only that, but remember a few years back when they had that big hack on yahoo emails. Yahoo hasn't been the same since then. I will say that Yahoo Finance does very well. The search engine itself just isn't what it used to be.
I think its their own mistake that killed yahoo! One of the bigger mistake was 'Google logo on every yahoo search was free advertising', million of yahoo users went to Google and never came back.
Yahoo is down year by year and I think it will almost disappear because they failed to adapt every year to the market they are in, like Microsoft has done.
I still think Microsoft's biggest mistake is not recognizing the "web on phone" boom. They came too late, and came with not as useful products. If they could have captured a share in this area, I am certain yahoo would not have died like it did now. This investment would have turned very fruitful.