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Predictions for 2008, #2: Yahoo! Resurgent

Yesterday kicked off my post-Christmas blogging with my first 2008 prediction - that BoingBoing would continue its devolution into a Cory Doctorow bookstore and link farm for BBGadgets.

One thing I didn’t want to continue with Prediction #2 is the tendency to forecast doom and gloom. Its really easy to pick out organizations that are stumbling and place a bet on their demise, and a lot of predictions lists read like a gleeful financial Grim Reaper’s shopping list.

So what are the bright lights for 2008? Believe it or not, I’d like to imagine that one of them is Yahoo. I know this is probably pushing the bounds of credibility, but for what its worth, I think the impact from the removal of Terry Semel will take years to really percolate down through Yahoo’s silo’d organization - and that 2008 will be the year when meaningful change can really take place.

1. Positve: Yahoo’s ditched Semel. Since starting at Yahoo in 2001, Wikipedia claims Semel has made off with $500 million. $500 MILLION. During which time Yahoo has stumbled, stagnated, hemorrhaged management talent, and generally fallen apart. Semel apparently managed to impart zero vision and leadership to the organization.
2. Negative: The management exodus will hurt for a while (Rachel Glaser, Scott Gatz, Neil Budde, Cameron Marlow, Andy Baio, etc.). That’s a lot of knowledge equity and relationship-power to have walk out of your company, and each troubled departure leaves a bad taste in the mouths of those left behind.
3. Positive: Yahoo’s till a traffic bull.
4. Positive: Yahoo has lots of great properties - Flickr, Upcoming, Del.icio.us, Yahoo Mail, etc. - a little vision could combine traffic & properties into a spectacular social-networked experience. Yahoo also has a powerful international presence.
5. Negative: Yahoo still doesn’t seem able to execute on anything. The peanut butter manifesto has faded from the radar, and Jerry Yang’s 12 months of change must be close to over by now - with little material difference to Yahoo’s properties. Is it a product of management flight? Or has execution been delayed while management is reorganized post-Semel?

So: ultimately, by my estimation, Yahoo has the traffic and basic building blocks to return to Internet stardom. The chief thing holding Yahoo back has been management structure and leadership - and I’d like to think that 2008 will be the year that Yahoo starts to get its house in order on both accounts.

2008, predictions, semel yahoo

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Yahoo!’s Meebo competitor “MyM” - new part of Yahoo!’s tanged social web

Wow - Yahoo is adding another layer to their insane social lack-of-strategy - a meebo-like service called MyM, story broken by Valleywag.

The Wag points out that Yahoo! already has a crowded, disjointed social plate, with overlapping and competing networks in the form of 360 (soon to be decommissioned), Mash, Flickr, Upcoming, Delicious, Mail, etc. Q: Where does MyM fit into this?

A: It doesn’t. That’s the point - Yahoo! is a ship without a rudder. I don’t know if its the stream of widely publicized executive exits, middle-management talent flight, lack of inter-departmental communication, or just cluelessness - but Y! is drifting like a Mary Celeste 2.0.

I like to think of it as the “General Motors” strategy - spinning out half-assed products, and sticking different brands and badges and superficial details on in an effort to capture share in many different demographics. Take a look at GM’s recent history; do you think that a complete lack of central value proposition is good for sustainability?

A: No. Its not. Jerry’s got work to do.

meebo, mym yahoo

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Recommendations & Discovery are the New Search

Recommendations and discovery are becoming more and more important - to the internet in general, but also specifically as a complement, supplement, and (gasp!) replacement to core search activities.

The big question I’m wondering is how long it will be before a “Search” box appears on the StumbleUpon home page - leveraging their human derived index to allow for narrowly focused, highly relevant stumbling.

In one sense, the rise of “R&D” can be seen as a response to Google’s dominance - services like StumbleUpon, Medium, and so on offer entrepreneurs and investors a way around Google to influence people’s web-usage patterns.

In another sense, however, the evolution of R&D is a natural consequence of technology’s march. R&D services are fundamentally search engines: they just use a different class of algorithm (clickstream correlation), and accept queries in a less-structured fashion. Effectively, R&D services are another point in the spectrum of human vs. algorithmic search options: Google pins down one end, while Mahalo, ChaCha, and even Yahoo! Answers compete at the other. StumbleUpon and their ilk exist in the center blending the human element (clickstreams) with the machine (automated aggregation and analysis).

Continue Reading…

calacanis, chacha, delicious, google, mahalo, medium, search, stumbleupon yahoo

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Microsoft’s Head in the Clouds: Positioning for Success

CNET reports on Microsoft’s buzz-worthy but vague “cloud computing” plans this morning.

The concept of the “cloud OS” or “internet OS” has been generating more and more discussion over time. IMHO, the cloud is the true Web 3.0 - the distributed, ubiquitous web. Its being driven by the fact that people’s data, documents, applications, preferences, and tools are now scattered across many devices, platforms, websites, PC’s, set top boxes, gaming systems, and phones - our connected environment begs for the portability, synchronization, and interoperability that are enabled by a true Web OS.

Microsoft’s concept of cloud services coupled with edge computing positions them to deliver. For example: I want my Garmin eTrex to automatically upload paths of trips I’ve made in universally parseable geoRSS, and I want to be able to later share those trips as maps around the dinner table on my iPhone using Google Maps. Microsoft aims to provide the service and storage cloud infrastructure to make that possible, as well as the edge bits (the software on the eTrex) to knit it all together.

Essentially, Microsoft wants to replicate the success factors of their desktop dominance by making their web services platform the easiest and most common to work on, just as they did with their desktop platform. Creating a strategy to deliver on that objective comprehensively speaks well for Microsoft’s continued success vs. Yahoo’s atrocious API mishmash, or Google’s compulsive, inconsistent delivery schedule.

For a long time, I’ve been critical of Microsoft’s big bet on Ray Ozzie - after all, his Groove application was an absolute horror. But if this is his vision, and if he can get Microsoft to execute on it, then I’ll take back my criticisms.

Ah yes: we all know how much MS loves Developers. Hat tip, Parislemon.

cloud, google, internetos, microsoft, web3.0 yahoo

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Death by Shareholder

I just wanted to write a quick post to introduce a concept: “Death By Shareholder.” Yahoo is the current epitome of this, though I worry that Google and/or Apple may get there eventually too.

Anyway, here’s the concept:

An innovative tech company, caught in the orgiastic throes of growth goes public, gets a board-of-directors, and a “real” CEO. The board and CEO then - despite the best of intentions - stifle whatever made the company great under a layer of bureaucracy, management-speak, and quarterly growth/revenue targets. The company starts to lose its edge and market-share.

The board then gets antsy and starts pushing management hard (throwing out CEO’s for example), which focuses the company on internal issues, resulting to further neglect of customers, perpetuating the problems that started the company bleeding in the first place.

Take a hard look at Yahoo, what’s spilling out of Jerry Yang’s mouth, and their recent, sad history of innovation-through-acquisition - it all points to a company that’s ruled by shareholders, not customers.

When all is said and done, I call it Death by Shareholder. I don’t know if its symptomatic of a bad Board, a bad CEO, or a company that should have stayed private, or what. It seems like the technology world demands a particularly well-balanced mix of activist board that imposes accountability, and hands-off board that allows an innovative company to keep innovating. I suppose it ultimately falls on the CEO to mediate that relationship.

apple, death+by+shareholder, google yahoo

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The Damaging Focus on Share Price

The recent news that Yahoo and FMI are in talks about MySpace makes me shudder, as does Jerry Yang’s acknowledgement of the “difficult task he faces to arrest the decline in the internet portal’s shares.”

From where I’m sitting, Yahoo’s going about their revitalization backwards already. Google and Apple drive their corporate decision making process with their overall strategies, worrying little about short-term share price effects; Yahoo drives its overall strategy and decision-making with knee jerk reactions to those share prices. Which approach do you think is more likely to lead to long-term success?

That’s why I feel any deal with FMI at this stage would be ill-conceived; its a share-manipulation stunt to give the board something to preen about, not a carefully considered move that fits into a long-term strategy (Apple’s style), or a wild bout of paradigm-shifting creativity (Google’s style).

apple, FMI, google, myspace yahoo

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Facebook Acquisition - Round X; I bet Google

I call Google FTW. The internets are all atwitter that facebook is on the block again - the Guardian says Yahoo is at it again; Battelle speculates that GOOG might snipe it like they did with DoubleClick.

Personally, I’ve thought Google is the more likely candidate for a while. Despite their occaisonal dropped balls on acquisitions (dodgeball), Google is about two things: platform and volume, which feed off each other and together are monetizeable. Advertising? Google built the platform. Search? Same. Video? Yup. Any area of online tech that you look into, Google has a major foundational play under way - if not a platform in a traditional sense, then a product option that has so much market power that it is the defacto platform or standard in its space.

Except social networking. Orkut, however you slice it, is an abject failure. Facebook would fill that gap, and the Facebook platform philosophy works nicely with Google. Google and Facebook could exchange hooks, interfaces, and API’s very quickly and create integrated products that deliver real value FAST.

Final note - I remember comments from GOOG’s CEO from a few weeks ago to the effect that Google wants to be able to tell you what you should be doing for the weekend. THAT’S A SOCIAL FEATURE.

So - when all is said and done, I call Google for the buy, Yahoo for the runner up. The only thing to derail this would be the SEC.

billions, dodgeball, facebook, GOOG, google, microsoft, orkut, sec, social, socialnetworking, weekend, yahoo YHOO

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When AdSense Fails

For all Google’s algorithmic awesomeness, the AdSense crawler still has the incredible ability to suck at keyword analysis. Take, for example, the awesomely popular Desktop Tower Defence game. Check out the AdSense placements:

Yes, that’s an ad for some type of antenna tower, because the page says “Tower” on it in a number of places.

Meanwhile, the perfectly serviceable meta keyword and content tags tell the real story:

<meta name=”description” content=”A flash version of Warcraft III TD”>
<meta name=”keywords” content=”warcraft, flash, game”>

So - Goolge is missing some killer targeted inventory, and HandDrawnGames is missing revenue. Is there no opportunity to create a better connection between content and ad placement here?

1. Meta Tags: I understand that meta tags are easily abused and Google by-and-large disregards them. What about algorithmically assessing the credibility of meta tags on a site by site basis on the criteria of URL age, history, and traffic pattern?
2. Webmaster Tools & AdSense: Again why not let webmasters categorize their sites in Google’s Webmaster Tools, allowing superior placement? Again, a credibility algorithm could reduce the impact from link farms, etc.
3. Tie into DMOZ: Ok, DMOZ is dead in the water. But perhaps its time to resurrect it, and make use of it as a categorization engine for AdSense. Crank up the community profile of DMOZ again, and surface its “category lookup” as a free API, of which AdSense would be the biggest but not only customer.
4. Del.icio.us: Ok, the Yahoo ownership might make this sticky for Google, but Del.icio.us URL tag history would be a great way to categorize sites for AdSense inventory purposes. Sure del.icio.us can be gamed, but so can anything, and community self-policing tends to dampen gamed popularity spikes. Perhaps Yahoo should be using this as a source of competitive advantage in Panama?

Are people at the search engines thinking of these sort of things? I would have thought Google would be all over this, given that relevance was what made AdSense king in the first place.

adsense, del.icio.us, delicious, desktoptowerdefence, dmoz, dtd, google, meta, metatages, panama, tags, warcraft yahoo

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Facebook Gets It, Becoming the Web OS: Microsoft 2.0

Facebook “gets it” in a way that MySpace, record labels, and countless other technical/social troglodytes don’t: if you own the platform, you own the industry. And if you own the industry, you get a cut of it all.

For background, see: TechCrunch,
CenterNetworks (recap), Fortune, and a million others captured on TechMeme.

Here’s my conjecture:

Facebook wants to be the next Microsoft.

Think about it: Microsoft owned the software platform on which the last 2.5 decades of computing has been done, and has profited ridiculously. Facebook is building the next generation platform - the apocryphal Web OS - by recreating the Microsoft environment from the eighties:

1. Create the platform. (its even called Facebook Platform)
2. Reach out to developers, make it easier or more profitable to build on your platform. (facebook is hitting both of these)
3. Let the users get hooked on apps developed on the platform.
4. Watch the platform spawn a user-driven ecosystem.
5. Keep users isolated; let them see the benefits, not the plumbing. (windows vs. linux?)
6. Profit!

Consider what would have happened in the OS market if Microsoft had restricted MS-DOS to only Microsoft applications, or selectively told large, popular vendors they couldn’t run apps on DOS (hello MYSPACE). The first open alternative would have put MS-DOS in the ground. Note too that this is not a discussion of technical superiority: lord only knows, Microsoft’s code has its issues, and the do-what-you-will approach to developers has caused millions of problems - but the open-ness, and ability for anyone to code anything made it the most approachable for every stakeholder in the PC value chain.

IMHO, Facebook is heading towards the same success and was prescient in turning down Yahoo!.

facebook, microsoft, myspace, platform yahoo

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Yahoo: Showing Signs of Being Alive

Yahoo has been all over the place recently, generating news and controversy in spades with bold moves to revitalize their properties, consolidate their core markets, and exit businesses with little future. David Dalka breaks the news that MyBlogLog, acquired previously by Yahoo, is due to get a new brand, new look and feel, and new features.

Finally, Yahoo seems to be showing signs of stirring - whether prompted by the PBM or otherwise.

There’s 4 signs of life that have been in the news recently:

1. Consolidating: Yahoo is closing Photos, focusing on Flickr. Say what you will about their methods, at least they’re eliminating some of their massive redundancy.
2. Focusing on Positive ROI: Goodbye Yahoo auctions.
3. Stirring up Strategic Discussion: the whole Microsoft Acquisition monster-under-the-bed has gone nowhere (which is a good thing), but more importantly shows that Yahoo is thinking strategically and (to some degree) pro-actively.
4. Investing in Acquisitions: the previously mentioned Flickr news, and David’s coverage of the MyBlogLog story are heartwarming - Yahoo is actually trying to capitalize on the value they paid for. Compare that to - for example - Google’s handling of Dodgeball.

My late night summary? Perhaps Yahoo is ready to come back and compete with Google - if not on core search tech, then at least with everything else.

mybloglog, peanutbutter yahoo

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