What's a Yahoo! to do?

Post ImageAlmost every day now I read something about Yahoo! and its “problems” and/or “options”. Those are in quotes because it seems people are very divided on Yahoo! – some think it’s in trouble, others don’t. I’ve been a Yahoo! user since the days of the grey page-background, and if you count sites like Flickr and del.icio.us, I’m still a pretty active user. Allow me to put on my Yahoo! pundit hat for a moment.

I guess Yahoo!’s main problem is Google. Now that there’s a search-media company consistently outperforming Yahoo!, it makes them look old and stagnant. It’s actually pretty unfair, because let’s be honest, no one has the kind of growth that Google does. Yahoo! actually does pretty well in terms of search traffic, advertising dollars, and all that other stuff, but where they seem to be lacking is in respect.

So what’s a Yahoo! to do? Here are the most commonly suggested strategies I have come across:

Replace CEO Terry Semel
This suggestion is actually fairly new, and if you read Eric Jackson’s open letter to Yahoo!’s founders, it starts to make sense. Seems to me this is a relatively short-term fix though.

Buy AOL
Apparently Yahoo! has approached Time Warner about purchasing AOL. I think this would be a good deal for Time Warner, and a not so good one for Yahoo!. It would bring the failed AOL Time Warner merger to a complete end, but it would only provide a minor increase in Yahoo’s traffic and advertising, all things considered.

Buy Facebook
This rumor has been floating around for months actually. It might bring some more eyeballs to Yahoo!, but it would do nothing to help transform or improve the company. And besides, from everything I’ve read, Mark Zuckerberg (Facebook founder) is no Caterina Fake (Flickr founder).

Merge with eBay
The two companies might seem complimentary because of their completely different focuses, but that might present a problem rather than a solution. I agree with Fortune: I think this one is unlikely, because I think integrating eBay and Yahoo! would prove extremely difficult.

Sell to Microsoft
This one is my favorite, and it has a long history too, first appearing in June. Microsoft certainly has the cash, and it turns out that the two companies are fairly well-aligned – Yahoo! has made heavy investments into IE7, is a PlaysForSure supporter, and has hooked up with Microsoft on a number of initiatives ranging from Sitemaps to Instant Messaging. According to the latest comScore data (released today), a combined Microsoft-Yahoo would have around 40% of the search market compared with Google’s 45%. Of course, there are some easy to spot problems with this deal – mainly that Microsoft has invested heavily in Live Search and adCenter already. That’s not a total deal-breaker though.

Stay the course
The people that don’t view Yahoo! as floundering like this suggestion. Sure Google is #1 for now, but it can’t stay that way forever, right? Seems like this is Yahoo!’s currently preferred course of action. If they could somehow turn around their disappointing sales and profit numbers, this one might be the best option after all.

The Microsoft option is especially appealing to me, because it would have extremely broad ramifications for the industry. It also seems somewhat unlikely, given Microsoft’s huge investments in their online properties (MSN, Live.com, etc). That said, purchasing Yahoo! would instantly make them the leader on the web, a position they have long sought after. I wouldn’t be surprised if Yahoo! ended up staying the course though, and in the end, maybe that’s better for everyone – Yahoo! included.

Update: Here is more excellent commentary on Yahoo’s current situation.

Coming together to support Sitemaps

Post ImageAs much as I enjoy reading about how Microsoft plans to defeat Google and how Google has trumped Yahoo and started on their way to ruling the world, it always gives me a good feeling when I read about the three giants working together. Sitemaps are the latest technology that Microsoft, Google, and Yahoo have come together to support:

The goal of this effort is to improve search results for customers around the world. This protocol enables site owners everywhere to tell search engines about the content on their site instead of having to rely solely on crawl algorithms to find it.

Interested in the gritty details? Read more about the Sitemaps protocol at the official website: http://www.sitemaps.org.

As I understand it, Sitemaps do not replace they very common crawling algorithms, but instead augment that data and help improve the crawlers. Seems like something that should have been developed a long time ago! It’s amazing what can happen when you work together isn’t it?

Oh, and the coolest part of all – Sitemap 0.90 has been released under a Creative Commons license.

Read: Live Search Blog

Yahoo hearts PayPal

Post ImageIn a deal announced earlier today, Yahoo and eBay are teaming up around advertising, e-commerce, and search. Yahoo becomes the exclusive provider of graphical ads on eBay, and will also provide some text ads. They are going to make a co-branded toolbar, and they’ll work to make their respective VoIP apps work together (Yahoo Messenger and Skype). The biggest thing of all though, at least as far as I am concerned, is Yahoo’s adoption of PayPal:

Yahoo will make eBay’s PayPal service the exclusive third-party provider of its online wallet, allowing customers to pay for Yahoo services from bank accounts, credit cards or balances associated with their PayPal accounts. PayPal will also be integrated into product offerings for Yahoo merchants and publishers, including the Yahoo Publisher Network, Yahoo Search Marketing and Yahoo Merchant Solutions.

Yahoo using PayPal essentially removes any doubt that PayPal is the de facto payment service on the Internet. It will be very hard for Google to successfully introduce a competitor now. Two of the largest sites on the net in Yahoo and eBay, plus the millions of other smaller e-commerce sites all using PayPal is an enormous hurdle for any rival payment service. PayPal is the closest thing we have to a truly digital wallet. Incredibly smart move by Yahoo, and excellent outcome for eBay.

Read: CNET News.com

Gmail Chat

Post ImageFor years Hotmail and Yahoo Mail have showed the connection status of your Messenger buddies in the web mail interface. A simple icon depicts whether they are online or not, and a simple click can launch a chat window or do other things. Google has taken that idea one step further, enabling conversations to take place inside the browser itself:

Google on Monday was set to launch Gmail Chat, which will let users send instant messages with one click from their e-mail account, see when contacts are online and save the chat history like an e-mail message.

The application’s Quick Contacts list is synchronized with a user’s Google Talk friends list and automatically displays the people a user communicates with most frequently and shows their online status. Clicking on a contact listed as being online opens a chat window in the browsers.

I think this new Chat feature will be played up as “Google innovating in the email space yet again” when really, it’s a poor man’s version of MSN’s Web Messenger. I mean, when you cut through the crap (read: beta label) that’s all it is! And even then, a web messenger is really only useful if you’re on a public computer or something.

Considering I don’t use Google Talk, this new feature is pretty much useless for me.

Read: CNET News.com

Yahoo buying Digg?

Post ImageYahoo keeps going further and further down the acquisition path lately – or at least generating rumors that they are. The newest rumor is that they are set to purchase Digg.com for nearly $30 million. Since the rumor first appeared there have been a number of updates that dispute such an acquisition, but it’s interesting to consider nonetheless. From Kevin Burton’s Feed Blog:

Update 2: The Digg blog officially denies the acquisition. Jeremy was smart enough to have “no comment“… Next time there’s a Digg acquisition rumor you’ll know you’re on to something 🙂

I wouldn’t be surprised if it turns out to be true. Digg would be an excellent addition to the growing stable of apps under the Yahoo umbrella, including del.icio.us and Flickr among others. The other factor to consider in this rumor, which Kevin does a good job of pointing out, is that Digg has insane amounts of traffic, and is going to need either more investment or a suitor with lots of resources to keep pace.

Read: Kevin Burton

What the hell Yahoo?

Post ImageOne interesting item floating around the blogosphere today is that Yahoo has decided to give up in the search industry, essentially conceding defeat to Google. Yes, you read that correctly – sickening isn’t it?

“We don’t think it’s reasonable to assume we’re going to gain a lot of share from Google,” Chief Financial Officer Susan Decker said in an interview. “It’s not our goal to be No. 1 in Internet search. We would be very happy to maintain our market share.”

I think it’s incredibly sad and disappointing that they have made such a decision. And I really have to disagree with Henry Blodget:

Yahoo! has finally read the writing on the wall that everyone else (except Microsoft) has been reading for three years: The search game is over and Google has won.

If there is anything Google has taught us, it’s that search is important! While Yahoo and Excite and everyone was ignoring search, Google improved it, and look where they are now (definitely read John Battelle’s book The Search, it covers this in great detail). Search is not even close to perfect – there is so much left to be done! I think it’s a mistake to give up, and I don’t think there’s any “writing on the wall” either.

Thank goodness we have Microsoft! Instead of giving up, they’ve decided to pour oodles of money into search to try and improve the experience far beyond Google. Of course we won’t know how successful they are for a while, but that’s not the point. The point is that they did not give up, they continue to try and innovate, and in the end, it will result in better search for all of us (as Google is forced to further innovate as well).

Yahoo was looking really good lately, with their string of strategic “Web 2.0” acquisitions, then they go and make a statement like this. I’m kind of baffled, really. Certainly Yahoo’s business is not entirely search, but if they don’t think that search is and will continue to be a big part of their business, even indirectly, then I think they’re making a big mistake.

Read: seattlepi.com

YouTube to be acquired?

Post ImageAccording to Michael Arrington, the popular video sharing site YouTube has signed an agreement to be acquired. An update on the post mentions that the rumor is highly speculative, but interesting nonetheless:

Whoever the buyer may be, it’s not News Corp. They have confirmed directly to me it has not acquired YouTube.

YouTube raised $3.5 million in venture capital just three months ago from Sequoia. It was founded in February 2005.

I remember early last year when I first discovered YouTube – there was almost nothing on the site! My how things have changed. YouTube has been quite popular in the blogosphere lately, as news has spread that their traffic is pretty amazing and by some measures has overtaken Flickr. Speaking of Flickr, my guess for the potential suitor is Yahoo – they’ve been on a Web 2.0 buying spree lately, so I wouldn’t be surprised at all if they picked up YouTube as well.

I’ll be keeping an eye on this rumor for sure!

Read: Techcrunch

Mindboggling – Microsoft buying Yahoo?

Post ImageEvery once in a while a rumor comes along that is so outlandish, so crazy, so never-gonna-happen, that it makes you really hope it does happen! The latest such rumor is that Microsoft offered to buy Yahoo, a rumor that has sent investors into a craze:

Analysts said reasons for the heightened interest in Yahoo call options ranged from recent rumors that software company Microsoft Corp. might be seeking to partner or merge with the Internet company, to bullish expectations for the company’s upcoming fourth quarter earnings report.

“The speculative activity in short-term calls might reflect the recent talk about an alliance with Microsoft,” Ruffy said.

Such rumors have been rampant since Google Inc. recently fortified its lead in the Web search market by taking a 5 percent stake in Time Warner Inc.’s AOL Internet unit.

On Sunday the Los Angeles Times cited what it called speculation that Yahoo had rebuffed an $80 billion bid from Microsoft as too low.

Did you see that? Eighty billion dollars! I can’t quite wrap my head around that amount! According to Microsoft Watch, the software giant currently has about $40 billion in cash.

There’s too much to consider if such a merger were to take place that I won’t even bother unless it actually happens.

Read: Reuters

Yahoo buys del.icio.us

Post ImageIf someone asked me who I thought was winning the Web 2.0 game, my answer would most definitely be Yahoo. The same company that bought Flickr has now also acquired social bookmarking site del.icio.us:

Joshua Schachter, the founder of Del.icio.us, confirmed a posting on the New York-based start-up’s site that the company had been acquired by Yahoo. A Yahoo representative confirmed that the agreement to buy Del.icio.us had closed on Friday.

Neither party disclosed financial terms.

“We are joining forces to build my vision of creating a way for people to remember things together,” Schachter told Reuters in a phone interview. “It is a shared-memory site.”

That means that Yahoo now owns both of the so-called “web 2.0” companies that I use most. Here’s what Joshua posted on the del.icio.us blog in a post cleverly titled “y.ah.oo!”:

We’re proud to announce that del.icio.us has joined the Yahoo! family. Together we’ll continue to improve how people discover, remember and share on the Internet, with a big emphasis on the power of community. We’re excited to be working with the Yahoo! Search team – they definitely get social systems and their potential to change the web. (We’re also excited to be joining our fraternal twin Flickr!)

Fraternal twin indeed! I can’t wait to see what Yahoo cooks up with two of the most popular new web properties now under its ever-growing umbrella.

Read: CNET News.com

Podcasting Links

Post ImagePreparing for and traveling to the Portable Media Expo last week meant that I fell behind on my usual tracking of what’s happening with podcasting (well aside from what I learned about at the expo itself). So I’ve been slowly catching up lately. Here are some of the highlights from my del.icio.us feed:

As I come across new items, I’ll of course add them to my feed.

Read: Podcasting Links