Sunday, 8 September 2013

Yahoo! wants its reigning internet legacy back, Now

At one time, this website designed by Jerry Yang and David Filo was was the home page for every internet user. Yahoo!, an acronym for Yet Another Hierarchical Officious Oracle went live in 1995 and was an internet giant until recently. Of course, it continues to be a mammoth organization even today but the rate at which it is losing its market share is worrisome. Several web players have aggressively gained market share at a scorching pace, leaving the likes of Yahoo! and MSN with a lot to worry about. The companies enjoy tremendous exposure to cash and that has been one factor helping them to implement business strategies, which most other companies can not afford to, to come back to business.

The rise of Google has been the greatest contributor to the falling market share of Yahoo!, especially after GMail was launched, Yahoo! has failed to keep pace. MSN continued facing similar troubles. In 2008, Microsoft made a ~$45bn to acquire Yahoo!, which Yahoo! rejected. Interestingly, Yahoo!'s market cap is ~$29bn today. The further rise of Facebook has not just hit Yahoo! and MSN but Google as well. All these companies have been unable to keep pace with the future's technologies.

A look at several of Yahoo!'s products indicate that they have failed to compete.

Yahoo! Answers
The portal offers some very good information database. It allows people to ask questions and answer these questions. A lot of questions that you want to ask are already answered. The of Wikipedia, however, has been a major drag on the growth of Yahoo! Answers. Further, Google's strong search capabilities help the users to find information by providing them search results containing articles or discussions by experts in the field compared to Yahoo! Answers where the people answering the questions may not be the same. People generally find it safer to refer expert blogs to find answers.

Yahoo! Finance
A relatively better portal. However, it has no USP to attract people to stick on to it.

Yahoo! Groups
One of biggest reasons for Yahoo!'s user base growth could be this, after Yahoo! Mail. While competition from Google and Facebook groups is strong, Yahoo! Groups continues to be a very strong product in its basket.

Yahoo! Mail
Yahoo!'s email services gave a definite shock to Hotmail. The volume of Yahoo! mail users has been very high. However, over the years, Google has been grabbing a significant share in the email market. In fact, the younger generation definitely has more interest in GMail than in Yahoo! mail. In the longer run, this could become a risk. Yahoo! has been making desperate attempts to revamp it mail services. Several changes to the interface have been introduced over a period of time. However, it still fails to keep up with GMail.

Yahoo! Maps
Maps services have undergone a tremendous transformation over the years. Google Maps have taken a huge lead by allowing users to add locations and approve such edits after due verification. Nokia maps also are well developed. Bing Maps have grown with support from Facebook. Yahoo! maps, thus, faces enormous competition and it would be a herculean task to get any significant move in this field. Further, considering that Yahoo! doesn't have any significance in the mobile space and maps are building a strong base through mobiles.

Yahoo! Messenger
Yahoo! Messenger is definitely one revolutionary product that brought about an era of chatting in the world. The internet's ability to communicate grew rapidly by enabling people to instantly communicate through IMs in lieu of emails. Further, the addition of group chat and video chat played a dramatic role in increasing Yahoo!'s presence all over. MSN introduced its messenger which which did not catch up as much. However, Google's GTalk took over a significant market share away from Yahoo!. The recent switch-overs to Facebook chat and mobile applications like Whatsapp, WeChat, Viber, etc. have put messengers at bay.

Yahoo! Search
The search business is perhaps the biggest way to garner revenues in the internet market. Yahoo!'s search mostly works through its homepage. Considering that Yahoo!'s homepage contains a lot of stuff, of which the search bar occupies a small space. On the other hand, Google's homepage is dedicated solely for search, which has slowly, perhaps, induced the mindset that Google is THE search engine. Its also not news that the search capabilities of Google are relatively advanced than any other search engine. Furthermore, the entire search business has now moved from the search box to the address bar. Google's Chrome has made the address bar itself the search box and other browsers have kept pace. However, while IE doesn't see great success in getting people use Bing and Firefox as well as Opera set the default search engine to Google. The latest beta version of Chrome provides instant results in the address as you type in the address bar. Yahoo! tried to developed an IE optimized for Yahoo!. However, it failed to catch any interest. Chrome's increasing market share, by default, improves Google's search market share as well. Not just for Yahoo!, it would be a very difficult task for anyone to displace Google in this business.

Yahoo! Toolbar
Toolbars caught up our attention some years ago. They seem to have disappeared now. Had they continued with some pace, Yahoo! could have been a beneficiary as it enjoyed a strong market share in this segment.

The recent Flickr changes
Yahoo! acquired Flickr several years ago and closed Yahoo! Photos. It was a strategic move to fight against the rising popularity of Google's Picasa. Off late, Picasa too has lost its charm and considering that Google has started focusing on Google Plus, its social networking adventure, Google has been making attempt to make Picasa a part of Google Plus. Yahoo! recently introduced several value added features to Flickr included an incredible 1TB storage space. This was, perhaps, more to attract people back to the Flickr platform. Google Plus and Facebook, anyway, offer an unlimited storage space for photos. However, the greatest deal with Flickr is it will save and let you access the original version of the photograph and not the one with reduced resolutions (like on facebook and on google plus). Picasa still allows original size pictures but the storage space is just a GB. Flickr could also be taking Dropbox head on through this move by possibly deterring users to make a move to Dropbox to save their photographs as the storage space is relatively limited.

Tumblr is another recent gamble by Yahoo!. Yahoo! 360, an attempt to enter the blogging arena, did not take off as expected. The Tumblr acquisition has been termed as a game-changer in the blogging space, like all acquisitions are termed. Posterous was acquired by Twitter in 2012 and it was shut down in 2013. Blogging itself may not be a real strong business, for some platforms. Wordpress and Blogger lead this market and it remains to be seen how much Tumblr could do to tumble the giants down. 

Executive Changes
Yahoo! has been making some desperate moves to get back their crown in the internet business. In the recent past, there have been several executive changes, the most talked one being the hiring of Google's Marissa Mayer to the CEO's position. Mayer was the first female employee at Google and has been the face of several Google products. She has been taking some decisions that have caught the market's attention, for eg, stopping the work from home facility for most employees, a spree of acquisitions including the $1.1bn Tumblr, $50m Qwiki, $40 Xobni, $30m Summly, etc. totaling to nearly 20 in just a little more than a year. This clearly indicates the serious desperation in Yahoo!, just like something similar seen with Microsoft, to turn around themselves to a company/product that the consumers would switch to.

A dire challenge to acquire loyalty
However, it is a real challenge for any company to migrate customers. New customer acquisition is relatively easier. To take a simple example, even though Tumblr or Wordpress can give me a lot more advantage, switching over to them would mean a loss due to new links, loss of some reader base, etc. Even though Yahoo! Mail or Hotmail revamp and ask people to sign up, it would be tough for people who are used to GMail to make a move. Google gives a host of services, like Drive, Calendar, Play (linked to android phone for quick access to apps), Youtube and Maps, the most crucial and useful services for many of us in a single access in a superbly powerful, neat and clean interface. Plus, the chatting app within gmail, where we get instantly connected to friends, is another benefit. Unless Google itself makes some mistakes, like it has been doing off late, be it introducing the new mailing interface similar to chats or forcing an inbox classification which some are not interested to use, etc., it would be difficult for any email service, no matter how wonderful, to get back some loyalty.

Next is What
Tech companies have to always remain ahead of race. There is 100% truth in the fact that what gets invented today gets outdated tomorrow. While acquiring tomorrow's technology is one side of the game, the real game is to develop such technology which would keep your consumer with you for a long period of time; something in which Google is the leader. Anybody with money can acquire companies but what do they do after acquisition is a big question. Twitter acquired Tumblr and closed it after having, perhaps, no clue of what to do with it. Flipkart acquired Letsbuy just to kill it. There have been acquisition disasters in the past as well. A lot remains to be seen what happens to all the acquisitions that Yahoo! has done recently. Could Yahoo! think of designing a mobile operating system? Something like Apple. Or could it partner with Microsoft or Apple to do something? Microsoft would definitely not like to do anything with Yahoo! as most of the products are competing products, and thus, if at all an acquisition happens, it would be to kill competition. There, anyways, doesn't seem to be such a competition with them now. An Apple tie up with Yahoo!? Who knows?

Well, the world changes each moment and thus, nobody can be sure of what happens in the coming days. For the moment, lets, as consumers, enjoy the attention all these are paying to us to keep us happy.

And yes, Yahoo! now has a new logo as well. All we can say, "All the best Yahoo!"

 is now

Disclaimer: All the information in this post is to the best of my knowledge. I might be wrong at several instances. Any help to correct the statements above would be highly appreciated. Images and references used are solely the property of their registered owners. They are used here solely for educational reference.


  1. Puneetkumar.. Yahoo Groups is in a freefall.

    They've already LOST a million users n the past month - people who were brought to the Groups by the LISTSERV list owners that created content and filled their Groups with photos, calendars for events, databases of facts, addresses, writing.. all the creative output of all the owners and moderators.

    They are right now, renovating the Groups with a new UI called 'neo' which of course is not functioning at all on almost every aspect.

    Photos folders are unworkable, and on large Groups cannot be correctly sorted, messages are a disaster, moderation tools are missing or non-working. Many owners have been locked out of their Groups with no ability to moderate - some have been flooded with off topic spam and many.. VERY many people who have worked with the STABLE platofrm Groups was, have given up in sorrow at the carelessness of the rollout.

    NO one was given notice, they were just entered into this 'upgrade' and given no warning to backup their data or even the chance to pack up and leave.

    There is a single Firefox plug-in that puts moderation tools in and gets underneath this 'neo' UI, and that has allowed some with the capacity to use it to reclaim their data and leave.

    If this is how Yahoo wants to reclaim it's past glory, it's not the best move to make the worst change possible on it's largest user-base without a single bit of consideration for the fact that the USERS are the ones bringing *content* - you know - the KING of all reasons to have a website is to have something to show, right? - to the Groups.

    Yahoo does not supply a jot of content, merely the platform, and it is the users that are getting pushed off a cliff because Marissa Meyer would apparently rather see them go to Google Groups or Nabble rather than let a working, albeit older Web 1.0 style system stay functional and unique.

    A typical attitude of thirty-something mindset that sees anything different as something to be destroyed, and NOT at all a way to keep Yahoo honest to it's historical roots that saw it at one time the greatest content portal there was.

    They're going to effectively drive off the largest Groups they have if they do not get their act together on this. If the Freecycle Groups fold, that IS the majority of Group members -gone-.. Take a look at FlyLady's Group and pay mind that she left it in 2010 when they tried to re-do the Groups back then. Over HALF A MILLION pairs of eyes, gone from Yahoo, gone on desktops, laptops and mobile and likely not coming back.

    (The FlyLady Group, founded in 2003 listed well over 500,000 members when she closed it, but the Group's history was recently brought up on some financial forums and Yahoo got in and checked it out and reset her numbers to only 2 members.. For a group a decade old, strange there's only 2 on that front page now isn't it? Ooops! Someone's hiding the fact that the Groups are losing users..)

    Yahoo need to pay mind that content is KING and the Groups CONTENT is created by owners, moderators and users that CAN go elsewhere if the platform continues to be a memory and CPU hogging, unworkable java front-end with a facebook 'wannabe' complex..

    1. FoodandArt, thank you for sharing your inputs. This is of great help.