The Lessons From the Yahoo vs. Google Rivalry…
One thing that strikes me so weird is Wall Street’s attitude towards Yahoo. It almost feels like most Yahoo investors that aren’t enamored of it are because “Google is cool” - be like Google. As a savvy person - and one that is savvy in online marketing - I laugh at that.
But this is not something to laugh at. The market’s perception of Yahoo is what will drive it’s future, as the unknowing owners / stockholders will demand from Yahoo to emulate and beat Google at Google’s game. Sad… really.
But hey, I don’t have Yahoo stock - or Google, so I’ll just stay carefree.
Instead, I’ll look at some of the recent transpiring stuff, and see what we can learn from it.
First of all, let’s look at Google’s strength. In my opinion, Google has systematically focused on something very few companies in history have - their employees. They strongly encourage their employees to get creative. This expresses itself in the “every other day a press release” from Google, with new products.
The thing that fascinates me as well is Google’s acquisition strategy. Many of the products that they launch look like just prototype “Geek toys”. Take Google Docs. There is no direction that they are going specifically. Or Youtube -after a $1.5 billion acquisition - and no word to investors where they plan on going. A word about preroll ads, but nothing groundbreaking. Then we have Google Docs.
I believe that Google has a couple of revolutionary beliefs that power their company. First, they value their employees. This is one of yahoo’s biggest woes , with many of their senior managers leaving.
Second, they value innovation. My belief is that they buy these company for the founders. This is the no risk way to stay current! If search ever goes down the tubes and turns to video - they own the biggest video player. If Microsoft tries to pull a punch of integrating search into their desktop - Google has got Google docs and can partner with Sun etc…
People think there is a “plan”. I think Google is hedging their bets. They will be on the forefront by merely owning the products.
The fascinating strength they have is their engineering focus. This allows them to create small but potentially powerful synergies between their offerings. Search + Chat + Google Documents, for example.
Or google Checkout and Adwords.
So why do I think Yahoo is essentially fine?
Yahoo has had a strong focus on News, their Internet search properties etc. The search was kind of second. But yet, their search isn’t a noticeably worse experience than Google’s search. Google is “geek friendly”, but yahoo is fine.
The sad thing, is that everyone is demanding that Yahoo focus on search algorithmically, like Google does. I don’t think that Yahoo can or should focus on that. They never will beat a company founded by engineers, and built their company to support engineers.
Get OFF IT. Stay a media company. That is Google’s biggest problem. Their focus has not been on media. Yahoo, on the other hand, has a powerhouse of media available. Focus on continuos capitaliation. Show the TV networks how to successfully integrate the media.
Yahoo really lost a big step of that when Google got youtube. But still, Google isn’t into creating, promoting and integrating media like Yahoo is. I’m not anti-Semel. I think that the whole media creation business - Hollywood, TV etc. needs reform and more efficiency.
But I think that Yahoo should do media. They are phenomenal about it, and don’t have the waste that the traditional media do.
But Oh well, who is David anyway…
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