If I were running Yahoo
In short: make stuff for non-technical people because that's their audience.
The interwebs are all excited about Marissa Mayer becoming CEO of Yahoo. She's a glimmer of hope and I hope she resurrects the company.
But how will she do it (if at all)? I have no idea, but I find it an interesting exercise to think about how one would. Here's how I'd do it in a very broad sense.
A preface: it's very easy (for me, anyway) to forget that nerds aren't everybody. I grew up in the computer-savvy Silicon Valley -- how could you not at least know what TechCrunch is? But most people in the world aren't nerds, and the winning products tend to acknowledge that fact somehow (think Wii, think iPad). It's not that there's no market for nerds, but there's a bigger (and arguably more important) market for regular people who don't know what a hard drive really is.
Nerds think of Yahoo as dead. Alexa says that it's the fourth-most visited site in the United States. Still alive, I say! Maybe not many nerds use it, but it's clear that many normal people use it.
And so I think Yahoo should be building technology for those people. Make a web that regular people can use.
Some people think that Mayer's takeover will be Steve Jobsian. To make technology's innovations accessible to regular consumers would certainly be Jobsian, and I think it'd put Yahoo back on the upward slope.