Blind Leading the Blind

I love Yahoo. I know, it isn’t politically correct to say so in today’s Google- and Facebook-centric worlds, but I have always loved that company, from the early days when Dave Filo and Jerry Yang founded it. It has been difficult for me to watch this once-great company struggle to find its place over the years.

Don’t confuse my love for the company with love for its products or leadership. I have never used Yahoo Mail as my primary mail, although Gmail has been my primary one for several years. I used to use Zimbra, which had tons of potential when Yahoo bought it, but they never seemed to get it right after that, whereas Google Apps for Your Domain did a masterful job. Similarly, I use Google Maps with regularity (including on my iOS devices, and don’t see it changing), despite enjoying Yahoo Maps in its early days. I do my primary searching on Google (although DuckDuckGo is tempting for its privacy). The list goes on.

Similarly, my view on Marissa Mayer is still in abeyance. She seems to have made some smart moves and acquisitions – although, as we saw, Yahoo’s track record on leveraging acquisitions is hardly impressive – but she appears to be completely out of touch with her employees, based on the work from home policies (see my comments here) and reports filtering out about her onsite “benefits.” On the other hand, the stock is up, it is now considered hip to work there, and the company hasn’t yet imploded.

Yet the company has always been a great engineering shop, has produced numerous innovations in products, and has hired some great talent. It appears to take its responsibilities towards communities at large seriously, and has contributed heavily towards open-source, even hiring one seriously smart guy to manage all open-source and open-standards for them.

So why do they continually get the business side wrong? Fortunately, nothing has happened (that I have noticed) over the last few days, and hope nothing will by the time I hit “Publish.” However, here are several examples over the last 15 years.

  • Maps API: As the world goes mobile, more and more app developers on Android and iOS want to integrate maps into their products: find the nearest Starbucks, route to the nearest Bank of America branch, etc. And yet, in late 2011, Yahoo deprecated its developer Maps API in favour of… Nokia. Nokia was already in serious decline at that point. What company outsources a core piece of product to another declining company? Blind leading the blind.
  • Geocities: Remember them? $3.5BN acquisition in 1999. They are almost non-existent today.
  • Deli.cio.us: $20MM (much smaller, but large name recognition) in 2005. Social bookmarking before people really knew what “social” went, a fantastic opportunity.┬áNearly gone and irrelevant today.

I do not know why Yahoo keeps suffering. I do have one theory though. In Yahoo’s early days, it was said, truly or not, that it stood for Yet Another Hierarchical Officious Oracle. It was an Internet pioneer, gave portal and search and direction to all who needed it, the online and dynamic version of the “Whole Internet User;s Guide & Catalog“. It viewed itself as a jack of all trades, an Internet-era AOL. I believe that culture led to both the good and the bad, the community contribution and great engineering, the lack of focus and constant buyouts.

Yahoo needs more than new management: it needs a vision and a mission, a real mission that all of its employees and shareholders can rally around. Only then can its management know how to organize, what to measure, if an acquisition makes sense. Until then, Yahoo’s management are flying blind, and they are leading the blind.

About Avi Deitcher

Avi Deitcher is a technology business consultant who lives to dramatically improve fast-moving and fast-growing companies. He writes regularly on this blog, and can be reached via Facebook, Twitter and avi@atomicinc.com.
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