Yahoo Could Have Been a Contender

Everybody in tech is talking about the fact that Yahoo's Terry Semel is stepping down, what it means for Yahoo, what it means for Google, yadayadayada.

Let's get to the point. Yahoo tried to be all things to all people. It pimped its pages to whoever would pay the most for cluttering them up. In its prime, it collected almost a half a million dollars a day from anybody who wanted to rent its big billboard of a home page. Instead of devoting themselves to their users, they sold out to the big brand guys with boxcars full of cash. The result was a confused, tacked together melange of services, some good, others not. You can see this content bloat graphically in a direct comparison of Yahoo's home pages with Google's.

Yahoo is the Pathfinder of the new millenium. Terry Semel came from Time-Warner, and like the people who ran Pathfinder, completely misinterpreted the nature of the Web revolution, where documents, not navigational eddies such as portals or other artificial structures, rule, and people have the freedom to "unstick" themselves from even the stickiest portal at the drop of a hat.

Yahoo has 12,000 employees and at least 100 Vice Presidents. I don't know what these people do all day but they're certainly not working on Yahoo's technology. Its management spent tons of money on elaborate offline marketing, including movie ads, big billboards, and other foolishness. It kept its traffic pumped up through acquisitions, but never really gave anybody a compelling reason to use Yahoo.

This is all sad because Yahoo used to be a damned good site. It was the first site to have a kick-ass news area, a great financial area, and a directory which, back when search engines were really crappy, was really useful. But like many dotcom failures, Yahoo overinvested in marketing, bean counters, and sales people, and let both its directory and its technology moulder away. This is classic Web 1.0 cluelessness, and while I don't think Yahoo will die tomorrow, it's day is past.

I can't imagine Yahoo pulling itself out of its mess without a major restructuring, which is a nice way of saying mass layoffs. You don't need 12,000 people to run a website.