I ran across a business news story about Yahoo’s impending layoffs today, and if you’re a deep-into-the-internet person like me, it certainly comes as no surprise to read yet again that Yahoo is on the skids. In fact, you’re more likely to be surprised to learn that Yahoo has more than 14,000 employees and made something like $6 billion in revenue last year. Yahoo ceased to be relevant a long time ago, and even the Yahoo services that still get some love, like Flickr, seem to be tainted by association. But the question I asked myself when I read the article was, “why didn’t Yahoo become a technology leader?”If you look back to 1999, Yahoo was the world’s homepage. They could make or break a new search engine, because lots of people still went to Yahoo first to find things, and rather than develop their own search, they partnered up with others. Their deep pockets enabled them to gobble up promising startups and integrate their products into their growing quiver. Yahoo was in a position to be the Google of its day, so why didn’t it? I suppose that the main reason was that Yahoo was never a technology company. Its original mandate was to be an organized directory of the internet. It evolved into a “portal” when portals were all the rage, and what that meant was adding services on to make sure that people stayed on Yahoo as much as possible.
The reason why Yahoo is irrelevant today is the same reason why it’s still a major moneymaker. The logical transition from being a portal was to become a “media company.” How to do make money from all the people coming to your web site? You produce or license more and more content to make your footprint larger and larger, and build a massive advertising sales organization to make money from sponsorships, on the old media model. And it’s way easier and cheaper to just add some more gardening chat rooms and movie reviews than it is to drive major technological innovations. But in a way, Yahoo was always a media company that just wore a tech hat from time to time. Same as AOL.
So is there a cautionary tale in there somewhere, other than the fact that the media landscape has changed so much that one of the pioneers of the new media is now being pushed aside by the newer media?
I just hope they leave Pipes alone. It is the only part of Yahoo I use or care about.
Yahoo had Years to cope with Google’s rise, but rather than emulate it or try something new itself it stuck to its guns. Eventually this will fail in the fast moving tech market. It did this with each product in turn on its own merits. Search, mail and now news.
I dont remember the last time I used a yahoo product to be honest…
Geocities?
Edited 2012-03-06 02:57 UTC
im not sure what you are trying to say?
Another example of them failing to capitalise on MILLIONS of users?
If you mean if I used Geocities, then basically no. My memory of the service is a load of sites, badly designed and with little/no accurate content. If Yahoo had a system where the information was verified by other users it could have been a mini internet in its own right returned by their own search engine. Could have been the way people settled all arguments before wikipedia :-p
These are the only two services I have used for a very long time. I can almost even remember when I stopped using their search engine after discovering Google, which in turn I’ve mostly stopped using Google and now use DuckDuckGo.
My understanding was that yahoo was trying to avoid being a technology company to avoid having Microsoft come after them. They targeted themselves as a media company and thus lost a lot of tech.
If they did in fact take in $6 billion last year, I can’t exactly agree that they’ve been pushed aside and should be used as a cautionary story for others.
Revenue is not profit, it’s only what they brought in, but does not say what they also had to pay out in the same year, they may well have paid out 5 billion thus their profit would be only 1 billion.
I’m not sure why you’re bringing up profit vs. revenue. Nobody here seems confused about that.
Using your pretend scenario, are you agreeing that a $1 billion/year profit points to a company that’s been pushed aside and is suited as a cautionary tale? Or, do you agree with me that that’s completely ridiculous?
If you agree with me, I don’t know why you replied. If you disagree with me, I don’t know why since all the indication is that Yahoo is doing just fine. With all due respect, your reply seems pointless.
Flickr is awful – most times when I try to use it, the text appears but the (all-important) pictures don’t. I don’t know why anyone would use the service now, let alone pay for it (it was like that for me when I had Pro membership as well).
The same is true for a lot of the big online media companies (notably Automattic and Google): they are over-capacity and slowness is a huge problem, with sections of webpages and sometimes entire services failing to load (in the case of Automattic, using their services caused my own blog to suffer intermittent outages which I remedied by disabling Gravatar and their stats). But Flickr is by far the worst offender.
I hope things like Y-SQL (SQL like access to all of YAHOO),YUI, YSLOW don’t suffer because these are really cool development tools.
Thanks for mentioning these! I Google’d some of the products you mentioned and had no idea that Yahoo had so many dev tools.
This page is awesome: http://developer.yahoo.com/performance/rules.html
Yeah Yahoo’s tools for front end development are very good IMHO. Their CSS reset is by far the best reset on the net that I have found IMHO and I prefer it to the Eric Meyers CSS Reset.
I have made some small mashups using Y-SQL for my own amusement (Google Maps + Flickr).
Their CSS framework is quite good, and the only one I find to be superior is YAML CSS framework.
Edited 2012-03-06 18:08 UTC
My first search engine was NorthernLight, Then Yahoo, then Google, now DuckDuckGo.
NorthernLight is now gone.
Yahoo is fading.
I wonder what the future is for Google?
Correlation != Causation.
My guess as to where Yahoo’s billions come from is outsourcing.
For example, if you have an internet connection in the UK with BT, your BT email services will be provided by Yahoo.
BT are obviously paying Yahoo a substantial chunk of cash to outsource their email provisioning. If others are doing likewise on that scale, it’ll add up to a decent amount of income.
Yahoo! is still big in Japan and South Korea. The internet scene in South Korea pretty much looks like North American internet scene in 2001.
Yeah, at&t here in the states still uses yahoo to provide email to dsl customers. Not sure what they’ve done for the uverse customers.
Yahoo ceased being a real player when they gave their soul to Microsoft (Bing).
Yahoo! is where everyones parents go to…if their not apart of the aging AOL collective.
They STILL haven’t figured out how to get-rid-of bot attacks in their webmail/IM platform.
I volunteered my time at a local high school recently. While I was there, I noticed well over half of the students were using Yahoo for searching. Their browser preference was about even between Chrome and IE. I was surprised by how few of them used Google (very small handful), or preferred Firefox (I can only remember 1 student who did).
Same at work.
Most people use IE8/9 or Chrome in the office. I am one of the few that use Firefox (mainly for firebug).
I find that everyone uses Google though.
I use Yahoo for email and my search engine of choice. I will never touch Google due to the fact that it spies on you. Yahoo learnt that lesson years ago after the debacle in China.
I am still using Yahoo, especially because of the email service. Aside from the fact that they didn’t yield to the trend of threads (apparently pioneered by Google), the email service is good and I prefer it compared to Gmail because of the ads.
Absolute Pros:
* option for no ads: I have been a Yahoo Mail Plus subscriber for 4 or 5 years in a row now. Paying 15€ to see no ads at all in a whole year is actually many times below the price I’m willing to pay. My subscription expires in a few days and I intend to renew it.
* disposable email addresses: This is, to me, the most valuable offering from Yahoo, the one thing that makes me stick with them, as spamming has become the bane of my life online (second to it is the tendency to insert ads before each and every video clip one wants to watch online). I leave Yahoo the very moment they stop offering disposable email addresses. They’ve removed the count of secondary addresses (as they were called back-then) from the UI months ago but at that time, I had 250+ different email addresses all linked to the single account I have opened back in the late 90’s.
* All of my Internet accounts (websites, forums, blogs, real-life services like gas or electricity, etc.) are tied to my alternative email addresses. So yes, I’m basically a complacent hostage of Yahoo.
* Last but not least, Yahoo Voice is the most affordable and reliable way I have to call my family in Africa. No, I know what you’re thinking, they can’t use Skype.
Cons:
* no threaded view of emails (not that threads are absolutely useful to me – I still prefer Thunderbird to Opera)
* stubborn stance AGAINST Opera: they ACTIVELY do whatever they can to undermine the experience for users who use Opera as their browser
* poor email recovery process in case of accidental deletion
* as was mentioned by @MasterSplinter, the email and IM services are plagued with spam, which is why I stopped using Yahoo Messenger for IM (except for Yahoo Voice)
* no significant update to Yahoo Messenger: years-old bugs are still there. Instead of fighting the MSN and Skype and others, they left it to rot, rust and die. Come to think of it, they’ve pretty much fucked up Yahoo Messenger as useful IM software. What’s with the conversation archives being stored online?
* Very bad language skills of their team on the French counterpart of Yahoo News. All news items or articles written there are riddled with grammar and spelling errors. I’m a proofreader so I hate that.
So Yahoo might not be a technology leader, they might be on the downward slope, their future might be very bleak but 1- they are still relevant for some people like me, now matter how few we are, and 2- of the flock of startups from the Internet bubble, they are the only big name still active and with enough energy to not look dead.
Anyway, I just hope they’ll hand around for long. Even if it’s just for the symbolic value of it.