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Wired News: How Yahoo Blew It

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Wired News: How Yahoo Blew It Wired News is out with a fairly comprehensive article chronicling the career of Yahoo Chief Terry Semel under the headlline, How Yahoo Blew It. The consensus of the story seems to be that Yahoo! was unable to navigate a purchase of Google back when a purchase of Google was possible and subsequently has failed at executing on their own search strategy.

Everyone knows at this point that not just Yahoo but Microsoft as well have lost the search game.

Google reigns supreme.

The cheese stands alone.

Remember where we were a year ago? A year ago Yahoo CFO Susan Decker took a firestorm beating in the blogosphere when she was quoted as saying, “”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.””

All of a sudden all of the back peddlers came out saying she was misquoted, etc. Caterina Fake, co-Founder of Flickr and Yahoo executive suggested that Decker’s quote was taken out of context and used one of her rare “bull shits” to describe the blathering that was taking place over the quote in the blogosphere. Internet search Guru John Battelle suggested that Decker’s quote wasn’t in character with the folks he knew at Yahoo, etc. VC blogger Jeff Clavier added, “To cut the commentary short: Bullshit. No way.”

I added my own commentary at the time as well adding “Say it ain’t so Jerry Yang, or at least say it’s part of a secret trick double secret agent plan to make everyone *think* this is in fact the case while you knock Google off their game with the old keep your eye on the birdy punch.”

And yet here we are a year latter. Yahoo’s search still sucks. They have not only been unable to hold ground in the past year, they have lost even more.

Last year I gave my own consensus on what Yahoo needed to do to regain it’s footing in search. I sincerely believe that Yahoo actually has the pieces and tools in their arsenal to not only stop the bleeding but to actually gain back market share. The problem comes down to execution. Until Yahoo can execute on the promise of social search, a search that is incredibly powerful, it will be difficult for them to gain back mind share. What’s worse is that as time goes on and Google increasingly becomes cemented in the minds of everyone everywhere as the superior vehicle and Yahoo search will increasingly become more and more irrelevant.

So let’s look back at what I suggested Yahoo do with social search a year ago and see how they executed. And yes, I recognize that armchair quarterbacking is certainly much easier than actually being out there on the field on game day.

A year ago I suggested that Yahoo.

1. Combine Flickr/Yahoo Image Search into one. Have they done this? No. They gave lip service to the idea late last year by adding a few images to four search terms in Yahoo Search but this not been executed at all. Flickr delivers superior search and Yahoo for two years now has instead served their users crappy Yahoo Image Search results. Yahoo can beat Google in Image Search today. Yes it’s only 9% or so of search traffic and yes ads don’t work as well on image search pages but to not do this just kills me when Yahoo has such a clear advantage here. I believe the reason why this has not been done is that Yahoo lacks the technological expertise to execute here.

Remember who bought Flickr folks, not Yahoo Photos, Yahoo Search. It was the search team that bought Flickr and yet the fruit in terms of search has not been realized as it should.

2. Buy Digg. Nope, Yahoo did not buy Digg. News search is another area where Yahoo could excel. Fetching back news stories influenced by an algorithm that determined rank for news stories is smart. Is there a “digg this” button at the bottom of Yahoo news stories? Nope. Can they build their own instead of buying Digg? Sure. But they haven’t and with their problems in executing buying seems smarter than building here. Of course now Digg likely wants more than $160 million for the property and the price tag will continue to increase as Kevin and the boys continue to roll out more and more features and gain more and more users. Social ranking news results not for today’s consumption but for archive search should be done and none of the major players are doing this.

3. Integrate Delicious. Nope. Again. It’s amazing how interesting Delicious search results are. Unfortunately you don’t see them in Yahoo search.

4. Improve search results through human editors. Yes this has been tried before and yes it’s failed. But I still think hiring 25 or so inexpensive editors to refine the long tail and filter out things that really don’t belong (especially in image search) makes sense. Neutralizing bad tags shouldn’t be that hard to do.

5. Buy TiVo. Not for the service (which rocks), but for the research and the ability to better index television search. The celebrity market is huge. If I’m searching for Winnona Ryder and she just happens to be coming on Letterman later tonight, being able to schedule, from Yahoo, my TiVo to record this show would be a unique advantage.

6. Integrate Upcoming.org. Nope. Still not done. Same thing as TV. If I’m searching for the Flaming Lips and they are playing a concert in my neighborhood, chances are this is going to be relevant to me.

So why is Yahoo not gaining market share? Because they can’t execute on social search. And so Google continues their dominance. Google believes in algorithms not social search. Their lame attempt at their Image Labeler game shows how little they know about social search. Yahoo can dominate social search but they don’t.

I’m also going to add one more point this year that I didn’t last year about what Yahoo needs to do better to execute in search. They need to better understand blogs and bloggers in search. Forget about what Comscore or Nielson or whoever say about search traffic, when I look at my own internal server logs for search being driven to thomashawk.com (excluding image search) I get the following breakdown.

Google 90%, Yahoo 7.5%, Microsoft 1.6%.

90% of my search traffic is delivered by Google. Google indexes blogs much higher than Yahoo does. As an example, look at this search on Google for Gene Scott, the controversial tele-evangelist I wrote an obit for a while back when he died. It’s highly ranked by Google. Now I’m not saying that my article is necessarily authoritative, but I do think it’s interesting (obviously I’m biased). But lets look at Yahoo. My search is not on the first three p
ages and if it’s not on the first three pages then it doesn’t count. There are lots of other examples, but Google indexes my blog (and I suspect other’s blogs as well) much better and more prominently than Yahoo does.

10 Replies to “Wired News: How Yahoo Blew It”

  1. Wow yeah. You’re right on the money here. But not because you’re a genius (I mean you are but not because of this) but because it’s so obvious. Yahoo has a huge number of assets but yet they have failed to integrate them into their primary service for some reason.

    Oh and another reason Digg gets more expensive with time: the longer they go without getting bought the more VC they have to take to keep it going which reduces the founders share of profit from a future buy-out. Which means that the incentive has to be pretty good for them to sell. Yahoo could still get them though. They’re one of the few companies who have a need and the cash on hand to do it. But if they never integrate then what would be the point?

  3. >5. Buy TiVo…being able to schedule,
    >from Yahoo, my TiVo to record this show
    >would be a unique advantage.

    While not totally integrated, this functionality already exists. When I go to tv.yahoo.com, there are buttons labeled ‘record to TiVo’ that’ll do just that.

    >…highly ranked by Google. Now I’m not
    >saying that my article is necessarily
    >authoritative…

    So why should it be highly ranked? I like reading your blog, but if I’m searching for info on who Gene Scott was, I don’t necessarily want your blog entry about him. I can’t count the number of times when I’ve searched for serious information and can hardly find anything because it’s all buried beneath people’s rants about the subject. I still think Google should have a way to exclude blog entries on request, as many are listed highly in Google’s PageRank just because of reciprocal blogger links.

  4. Jeremy, Yahoo’s “primary” service used to be search but no longer. That changed a long time ago. Yahoo’s primary service is exactly as you indicate, more a combination of many different services, mail, messenger, finance, my yahoo, flickr, yahoo photos, fantasy sports, etc. Which isn’t bad at all. But what I’m addressing here more is Yahoo’s inability to improve one single area, perhaps a shrinking part of the overall Yahoo pie, search.

    Yahoo *can* significantly improve search by integrating the various social properties that Yahoo has acquired over the past few years. And perhaps this is all coming and just around the corner, etc. etc., but from the outside, without the benefit of internal visibility the words that it’s coming ring hollow. Yahoo’s super secretive about their plans and why the delay on the integration.

    A while back I think it was Stewart who said (I might be wrong on this) that one of the reasons for the delay on image search had to do with the fact that Flickr wanted to give people a way to opt out of having their photos in search. Well we’ve had that now for quite a while and still no meaningful search integration. My own view is that Yahoo lacks the technological expertise to pull it off. But that’s just a guess as again I have no guidance as to what the hold up really is.

    Austin. That’s exactly my point about TiVo. You can record shows both at TiVo.com as well as at tv.yahoo.com, but it’s not integrated with *search*. The fact that Britney Spears is going to be on Letterman tonight when you are searching for Britney Spears is a super relevant fact. By better integrating television appearances with celebrities and making easy one step record options from within search you would improve relevancy. Further work should be done with television as well not the least of which is indexing closed caption text for archived shows.

    Google’s greater indexing/weighting of blogs is interesting. It’s not every blog of course. They rely on PageRank, but overall it seems to be working. Overall generally well page ranked blogs consistently produce interesting content. When I want to read about search or Google, I’m interested in what John Battelle has to say. When I want to read about Microsoft or videoblogging or Podtech, I’m interested in what Robert Scoble has to say. When I want to read about Yahoo, I’m interested in what Jeremy Zawodny has to say. I think Yahoo needs to do a better job at integrating blog posts, especially from higher linked blogs, into their search results. You may not, but I think this does something to give Google an advantage at present.

  6. Good to meet you at CES Thomas. Thanks for your coments on the Digital Home stuff we were showing. Yeah, its pretty easy to pick on Yahoo! right now, because the dialogue is framed purely in terms of search. Fact is, there are many bright, passionate creative people over here working to connect the dots. Many of these folks are pretty new here, and their impact is only now beginning to be felt. Personally, I’m long on Yahoo.

    By the way, as the guy responsible for the Tivo scheduling app–I appreciate the thoughts. You are tracking with how we think about it. Stay tuned for more developments in this area. By the way, the realtime scheduling implementation we just launched with AT&T; Homezone is awesome. I’ll give you a demo sometime if you’re interested.

  7. Mr. Hawk,

    I think your comment above points out that many of Yahoo’s problems are intertwined with their lack of tansparency and penchant for secrecy.
    They are not a “cluetrain manifesto” company.

    Secrecy may have uses, but it also certainly makes early adopters and influencers very nervous.

  8. Patrick, nice meeting you as well. I’m excited about things that Yahoo is doing in home entertainment. You are working in one of the most exciting areas of technology. As we discussed, I think figuring out high def ought to be a priority for your team as this is where the future of television is headed.

    I really liked the interactive stuff you guys had in place to go around the TV. It would be great to see you guys figure out how to integrate tv listings better into search.

  10. I agree with you on just about all points except for the buying Digg part. Social news is the future, yes. But Digg has a lot of issues, and I think it’s one area where Yahoo would be better off building their own.

    I completely agree that they should be going after blogs and bloggers (especially instead of looking at a billion+ for Facebook). Thing is, they have practically nothing in that area (save for MyBlogLog). I wonder what it would take to acquire SixApart? Technorati?

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