Tag Archives: Yahoo!

Yahoo! is sailing these ship of fools

Yahoo!‘s founder, Jerry Yang on retaking control of the management of the troubled company sounded more like an Insead graduate than a switched on Dotcom entrepreneur:

“My immediate and overarching priorities are to realise Yahoo!’s strategic vision by accelerating execution, further strengthening our leadership team and fostering an even stronger culture of winning.”

Err… sell your Yahoo! shares fast.

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Sky surfs the second web wave

Three smart moves by Sky and its clear that you don’t need to be a New Media company to be successful online. You just need to understand media. Yahoo!, take note.

First Sky bought MySpace and then it decided to dicth satelite for broadband via lines, thus enabeling interactivity and not just one to many broadcasting services. Then this deal was done by Sky with Google:

BSkyB has announced a partnership with Google to provide its broadband customers with branded search, email and other services including a YouTube-style video sharing website.

The deal is being touted as Google’s first global partnership to provide such a range of services and the agreement will also lead to the US search engine giant making its first move into TV advertising.

Initially Google will provide the “click through” search bar and display advertising on Sky’s broadband portal – sharing ad revenues with the satellite broadcaster.

But wait, there’s more!

The two companies are also exploring “future forms of web, TV and mobile advertising”. Under the deal with Sky, Google will look at the possibility of using the information about viewing habits that can be obtained through the satellite broadcaster’s set-top boxes to produce more targeted TV advertising.

Google is already experimenting with newspaper, magazine and radio advertising in the US, using its technology to sell and target adverts.

As part of the deal, Sky Broadband customers will be able to edit, upload and share their video clips on the new user-generated video portal, and can also post and download clips from their mobile.

New communications tools available to Sky Broadband subscribers will include a customised version of Google Mail, Google’s web-based email service for the UK, and instant messaging. Subscribers will be offered addresses at the sky.com domain and the service could be extended to Google’s internet telephony service.

Google’s search tool and targeted search advertising will be introduced across Sky’s network of websites, with revenue shared between the two firms. Financial details were not revealed. Sky is aiming to tap into the UK’s booming online advertising market through the deal.

Compare these bold moves with Yahoo’s dithering over user generated content and Channel 4 and BT’s hamfisted moves into Web TV through their 4oD and BT Vision services.

As Anthoney Lilley points out in today’s Media Guardian (registration required), the biggest problems of prospective broadcasters is how they fund production and not distrinution.

First, video on demand was already here anyway – in the form of the Sky+ box and DVD collection and, for some, Home Choice, NTL or via peer to peer on the net. But I doubt the fanfare amounts to much for another reason. Broadcasters need more than new distribution platforms to define their place in the emerging media ecology. Basically, most VOD services are shops. That’s it. Their biggest effect is to turn media and telecoms companies into retailers. The big problem for broadcasters won’t be distribution but rather how to fund new content.

He continues:

Of course, finding new distribution platforms will be part of solving that challenge but it won’t do the whole job. Likewise, BT Vision might help to lock some people into BT broadband products. The big money for BT is in access and services across a wide front, not in broadcasting.

As for 4oD, it’s early days, but the shop shelves seem a bit empty. I know how hard rights deals are to put in place, but if you download the application – which is a smooth process – and then have a look at what you can, or more accurately can’t, watch from last week’s schedule, you’ll see what I mean.

More tellingly, the 4oD service is conspicuous for its lack of social networking features. C4 claims to be an “editor of choice” for its audiences in that they trust its brand to help them choose what to watch. This is definitely correct in some circumstances.

But not all the time – and it isn’t mutually exclusive with recognising that the “audience” is now an active part of services such as iTunes Music Store and Amazon. Can I send a preview of a show to a friend? No. Can I review it? Don’t think so. Is 4oD aware of my viewing habits and those of people like me and does it prioritise content or recommend stuff as a result? No.

You get what C4 thinks you might be interested in – which has a strong relationship to what they have on the shelves. 4oD is rooted in the mindset of a TV channel.

Locked up in his statement about funding production being the main challenge is this. In this WebTV value chain it is important to be a content and rights owner. Distrubution is taken care of by Google, MySpace and thousands of blogs.

To be able to fund their productions, broadcasters will need advertising or subscription revenues and if they are web savvy, they can get their users/ viewers to make content for them on the cheap.

It’s interesting then that the young Murdoch – sounding a bit like a member of the digirati – spelt out where BT and Channel 4 have been getting it wrong. According to Murdoch: “The weird thing about the media market is that people have thought about it in two halves; online and TV. The truth is, in a connected market, everything is connected.”

Sky knows that they have to open up and give their users an opportunity to watch what they want, and they know that the advertising has to be personalised and targetted like on the internet.

Antony Lilley again:

This is the nub of the problem with 4oD and, for different reasons, BT Vision. Both services have their roots as extensions or protections of existing business models.

Companies which fail to take this kind of thing into account usually lose out to rivals who approach “their” business from a new direction.

And Lilley gives an interesting snippet of news and a big prediction:

With this in mind, look out for The Venice Project from the people behind Skype – it’s aiming to combine social networking and legitimate TV content and I think it might knock the impact of YouTube into a cocked hat.

Yahoo! reorganises – will it help?

ZuluZulu doubts it.

News reports claim that the latest reorganisation buy the massive internet portal signifies a rethink by Yahoo and the web community at large about content on the web.

The departure of television veteran Lloyd Braun from Yahoo Inc. underscores a shift, or at least a major hiccup, by major Internet companies away from creating costly original content.

Braun, who once ran primetime programming for the Walt Disney Co.’s ABC network, left Yahoo this week after his role was greatly diminished in a companywide reorganization that placed his group into a newly created division.

Yahoo’s hiring of Braun to run the new Yahoo Media Group two years ago sparked speculation that the online company was itching to become, in effect, a TV network on the Web, producing its own shows to attract eyeballs to its lucrative Internet advertising.

After all, Braun was responsible for ABC’s nascent turnaround and the genius behind its hit show “Lost.” Analysts saw great symbolism in the consolidation of Yahoo’s far-flung media sites — music, video, finance and news — into a new Santa Monica office that was once home of fabled movie studio Metro-Goldwyn-Mayer.

But two years ago, no one foresaw the rise of sites such as YouTube and MySpace, which became huge companies by aggregating user-generated videos and creating communities where people could network. YouTube was eventually bought by search giant Google Inc. for $1.76 billion, while MySpace was snatched by News Corp. for $580 million.

Err… obviously not. But hell they should have. Anybody that poured over internet usage paterns 6 years ago would have told you what the web gurus like Tim Berners Lee were saying for ages AND that was blidingly obvious anyway.

The web is an ultra democratic medium. Anybody can publish cheaply. It’s less of a one to many medium (broadcast) and more like point to point. The first killer apps on the web were search engines and email. Did any of these highly paid guys spend some time to think about it why this was so?

I mean Yahoo had a very succesful email service, search engine, intstant messenger, Yahoo! Groups, Geocities – what did these extremely succesful services have in common? They all enable web users to find, communicate, and create content. Who cares if most IM conversations are inane or most Geocities websites are junk. Yahoo! paid nothing for this content or conversations. And websites like blogs.marketwatch.com agree:

“About 30% of the pageviews on the fast-growing new-media newspaper company Topix.net come from community comments.

The figure tells you something about what the Internet generation wants to consume online.”

 

Yahoo dispels first mover myth

Could Yahoo’s! management not also extrapolate on this logic??

Braun also had to curtail ambitions to produce original shows for the Web. Replicating the TV network model would be prohibitively expensive, especially if such shows could only be viewed on a small computer screen.

Yahoo did create several new video and other programs, including news dispatches from war journalist Kevin Sites. The company also recently launched a series of live music performances similar to those featured on rival AOL’s site.

But in a twist, one of its most popular shows, called “The Nine,” features host Maria Sansone counting down nine notable user-generated video clips found on other sites such as YouTube.

And the new chiefs at Yahoo don’t inspire much confidence. The LATimes report:

The new rising star is Sue Decker, the chief financial officer, whose promotion Tuesday positions her, analysts say, as the heir apparent to Semel. As head of a new group that caters to advertisers and online publishers, she will oversee Yahoo’s biggest moneymaking ventures.

“What we’re doing is aligning ourselves with our strategic priorities,” Semel said in an interview.

Yahoo said it was searching for an executive to run a second group focused on users. The audience group includes search, communication products, online shopping and media properties.

Farzad Nazem, Yahoo’s chief technology officer, will lead a third group that is focused on providing technology for the other two businesses.

If Yahoo has any sense, the person who runs the audience group would have the most say. Without careful attention to their users and what they want to do, Yahoo will be adrift.

Read more about the problems of being an internet portal.

Internet portals are out of the step with the web

Morpheus : You take the blue pill, the story ends. You wake upand believe…whatever you want to believe. You take the redpill…..you stay in wonderland…and I show you just how

deep the rabbit hole goes. The Matrix

Does the portal concept still make sense on the Internet? Nope, read on, stay in wonderland and I’ll tell you why.

Lets restate what a portal is supposed to be: A website that offered structured pathways into the web, offering a range of services and content (many their own, while others would be covered by partners). These portals would be the gateway through which most internet users would pass to the rest of the web. And when companies like Yahoo! and Lycos had their IPO’s the market agreed.

For companies like Yahoo!, Lycos and MSN being internet portals have caused endless problems. They have been at sixes and sevens, trying to be all things to all people, fighting with their own internal subdivions over the use of an overarching brand, style, and even navigation. All a direct result of being portals.

They have been heamoraging users and not growing their reach except in key services like instant messaging and email where they got an early head start. But they are loosing ground to the MySpace’s and Google’s of this world. In fact, most of their organisational and strategic problems are related to them being portals.

Portals are tied to an old fashioned view of the media. A view that did not get that with the internet power shifts away from large top down media companies. Companies that were set up to produce fairly general content to be consumed by large groups of consumers.

In reality we are moving deeper into a world where every person can become a producer and not just a user of media. This is a concept that companies like Google got from the start.

If you accept this vision of the changing media world – a world where it becomes easier and easier for anyone to create a website, post a comment, and upload a video – it follows that on the Internet there will be a great variation of websites, and opinions, and also lots of competition for people’s attention.

In this world entry points to the web are very valuable. If you control these entry points you become the gatekeeper to this fragmented media landscape. Which is exactly why Netscape – the company that blasted the first hot air into the first net bubble – was thought to be so valuable. It was thought that through control of an internet browser, one could become the gatekeeper to the web’s content. Following the same logic, the concept of the internet portal at that time did make sense.

And today, with mobile phone portals this arguments still holds, but just. Mobile operators have a huge captive audience, its cumbersome to type on the mobile interface and therefore to search for services or information is difficult to do.

Yes, until search engines evolved and especially when they evolved to rank listings according to quality, the links on a portal was significant. But search ranked by quality, introduced by Google’s Pagerank system changed the landscape dramatically. (Google ranks a page according to how many pages link to it. Thus if web users link to your page, Google reckons it merits a higher value.)

An even earlier way of how search engines rank websites were the building blocks for this change. By analyzing how popular a site is for a certain set of keywords the trend towards focused and simplyfied pages became significant. If your website does lots of things – like most portals do – and list them all on your home page, the home page ranking will be diluted.

Pagerank will be diminished on a jack-of-all-trades page, because the homepage will give no clear indication of what it’s about, and the web users won’t recommend it by linking to it.

This is because it will feature many different keywords. This coupled with the fact that websites are unlikely to link to a page which is just a collection of different services, is deadly. No single Portal could possibly list all the websites a user likes to use. Users’ needs are too specific and various. And thus the websites run by users tend to link to services directly.

Another way to understand systems like Pagerank is how they value the links outward from a page. A link from a high value page will transfer high Pagerank value to the page it links to. But the value to be transferred is shared, so by having three links from a page, the value would also be split three ways.

Thus with a traditional portal’s home page with lots of links to various of its services, the result will be that its links’ power to transfer value will be diluted. The more links they have the more true it will be. The value transfered from a link on the home page of Yahoo! to its email service will be shared with its links to its other many services.

Search engines’ indexing hierachy favour and therefore create a web where there are lots of specialised “champion” websites. Often the characteristics of an internet service further enhances this “champion” effect because of so called economies of scale (Ebay) or a critical mass of users (think IM, MySpace).

The result of all this is that search engines have become quality selection engines. Users have come to know that used well, a search engine gives them access to the best of breed web content and services. Once you follow this logic you can see how the old style portal concept is really dead. A concept for those that won’t experience wonderland.

What compounds this problem for the portals even more is that users are increasingly becoming so used to the mechanics of search, and are increasingly using it as a way of navigation. (I for instance, when I want to look up information on Uganda’s dictator Idi Amin on Wikipedia, just search for “wikipedia idi amin” via Google and click on the first link Google serves up. I’m there. Why bother entering the Wikipedia address into the browser and then searching for Idi?)

Search as navigation is becoming an unstoppable force.

The portals are squeezed on two sides. They are not specialist sites – the sites that tend to be recommended by search engines – and users don’t need portals to point them to these sites.

Time for a bit of futurerology: Users will navigate the web in two ways. By searching via keywords and by searching via brands (or rather sub-brands and sub-sub-brands). In other words when searching for something and you don’t have a brand to mind – that you know will address your need – you will just do a normal keyword search.

Otherwise you will Google/ navigate directly to the sub-brand you know and trust to work well. (I for instance use Yahoo! Mail and I Google “mail yahoo” to directly go to mail.yahoo.com.)

And its already happening. The majority of Yahoo! mail users do exactly that and never see the Yahoo! front page. Even though Yahoo! tries to persuade us all the time to go and have a look and circulate its traffic.

Yahoo! is arguably the most successful portal in that unlike MSN – they actually have one or two channels (Yahoo! travel – as opposed to the large staple portal services: search, email, IM) that are a relative success.

But even Yahoo! has been realizing that users come to it for specific good products and not primarily because they are a portal. That’s is why Yahoo has bought a huge one act pony Flickr (a photo sharing community site) but wont be changing Flickr’s name. Nor have they been adding links from the Yahoo! home page to Flickr. It does not need to. Flickr is a top ranked website already thank you very much. It would be stupid to change its name because a recongnisable brand is paramount if you want users to find (search for) a service.

The so-called Yahoo! home page is actually just a glorified site map. Their users increasingly go directly to the services Yahoo! offer bypassing the front page.The successful Yahoo! channels and services are a success because they are good, not because they are on the Yahoo! homepage.

People have been wondering why Google does not link to its other products from its home page. It’s exactly this reason. They don’t need to, and if they did it would reduce the simplicity and usability of the Google.com page, making it less popular with users.

So what are portals to do? (To be continued.)