Why is Yahoo Answers shutting down?

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Because VERIZON won't bother to make the site work or be profitable.

VERIZON's board made the decision, most employees were already laid off

anon nailed it, and places like Business Week etc have articles answering that Q, even google it...lots of articles

Bad management

Lack of technical maintenance

Not appropriate moderation

Being open to massive spambot attacks

Exodus of many quality users due to the above

Influx of trolls and bored people trying to use it as a chat site, due to the above

Verizon's lack of desire to run a site like this    

Nobody from Yahoo is going to Answer this Question but

Yahoo Answers has not been doing well Lately a lot of Users have Left Poor Maintenance of the Site they have not Fixed a lot of the Problems they are Likely Losing Money on it as well so They feel its Best to Close it Down If there not going to Fix it they minus as well Close it Down

IMO, only a few employees of yahoo answers exist. 

I am a Yahoo executive and I can tell you the real reason we are shutting down this site. The internet needs the bandwidth to stream more porn.