Yahoo! was a dominant force in the heady days of the dot-com boom. But can they still challenge the rapidly growing Google corporation?
As the highest-profile Internet portal to survive the tech crash, Yahoo! continues to evolve with changing market forces. Brazilian Bruno Fiorentini is the new COO of Yahoo!7 and spoke to PC Authority about the future of Internet portals in 2007 and where this wide-ranging business is heading. Rather than just competing on content delivery, the major portal companies are now competing on multiple fronts where the mantra “content is king” has caused them to innovate in a number of key new areas.
The world’s best search
Discussing Google’s brand dominance as the most renowned Internet search engine, Fiorentini was dogmatic. Is Google technically the best search engine? “I don’t think so.” he said. While conceding that today’s Google search is faster, “We have a broader search than Google.” he noted. Bruno also pointed to Yahoo!7 innovation in its Answers site, a product that he claims Google cannot match.
“We have users generating content in search (with Yahoo!7 Answers). Google gave up doing it,” he said, referring to the ill-fated Google Answers, a project that the smartest guys in the room cancelled.
Yahoo!7 Answers allows users to post tough questions to the community, which will be answered by those that deem themselves qualified. The more valuable responses will be rated highly by the question poster, leading to improved credentials for that person.
Battle of the toolbars
It seems that every major Internet portal or search engine company is clamouring to have users install one of their web browser toolbars. Today, NineMSN, Yahoo!7 and Google are all pushing their web browser toolbars in earnest. When you visit Macromedia’s site to download the very necessary Macromedia Flash 8 player, by default you are stealthily primed to download and install the Google toolbar at the same time, unless you opt out of the finely-printed check box at the bottom of the page. When you install Yahoo! Messenger, you’re also primed to install the Yahoo!7 toolbar at the same time. These toolbars are being shoe-horned onto people’s computers with wild abandon. We asked Fiorentini why.
“I think that distribution is key in this market.” he said. “[The Yahoo7 toolbar] is a very good way to distribute content.” he added. “It can help you with your web experience.”
Bruno explained that Yahoo!7’s research indicated that most people only visit a small core of websites regularly. In light of this, Bruno opined that it makes sense to make permanent links available to those sites as a labour-saver.
As an example, he referred to a brand new announcement that Yahoo!7 will be supplying digital editions of national consumer magazines like New Idea. Bruno explained Yahoo!7’s ambitious partnership: “You can add the full content of magazines like Marie Claire, Men’s Health and New Idea into your toolbar with one click,” he said.
The old-fashioned portal business
In the early days of the World Wide Web, portal websites were a panacea. When links were few and web content was relatively scarce, the value of a site that presented links to numerous relevant pages was gold. Yahoo!7’s legacy in this area is not being neglected at the expense of new innovations, according to Bruno.
“We are in the Internet portal business” he said. “We service 500 million users around the world,” he added.
Today, Yahoo!7 has recently launched innovative iterations of its products, for example its Yahoo!7 Messenger application and the current AJAX-powered version of Yahoo!7 Mail, internally codenamed “Candygram”. This has fairly dynamic drag-and drop functions, and enhanced elements which update dynamically without reloading the page contents.
Modular Internet advertising
One of Google’s cornerstones is its innovative advertising system called AdSense. Bringing Internet advertising to the masses, it allows companies to get broad exposure on a variety of sites for an outlay as small as $50. Sites that carry the Adsense code display the ads which are distributed throughout the world dynamically, returning the web hoster a small percentage of click-through revenue.
Bruno responded to queries about Google’s AdSense by making an announcement: “We just announced a project called Panama and that will be released in the second quarter (2007) internationally,” he said. Panama is an upgrade of Yahoo!’s advertising system which hopes to improve advertiser’s click-through rates.
Yahoo! docs and spreadsheets?
With Yahoo!7 striving to match or exceed Google in so many departments, it seems logical that they might take aim at the web application business, launching an online spreadsheet or word processing application. Such a move would put Yahoo!7 in direct competition with the likes of Microsoft and SAP, who are already sweating under Google’s watchful eye. However, Bruno didn’t take the bait.
“We are not a software company.” he said. “It’s not our core business today”. Bruno explains that the core of the Yahoo!7 business is around bringing their existing products together more tightly. “It’s all about integration” he said.
Obviously, when you have a captive audience using a given product, it makes sense to present them with easy access to your other products that they could be using. For example, withYahoo!7 mail, Bruno noted its integration with existing properties to mimic an Outlook-like functionality: “We can integrate messenger, we can integrate video [with Yahoo7 email],” he said.
While Bruno wouldn’t say whether Yahoo!7 is working on a Google Docs & Spreadsheets killer, he didn’t deny it, either. He did add a cheeky proviso: “As for the future? I couldn’t say.”
Yahoo! Video
Among the various services offered by giant Internet portals today, video is a perennial hot topic. Yahoo!7 is approaching it from a rather more official direction than the YouTube or Google Video type services, in that they may soon be in a position to offer something to lure the US TV episode-file sharing crowd: official American TV episodes. “We are in discussions with the [American TV broadcaster ] ABC,” he said. No further details were revealed as to what the deal might entail.
On media convergence
At a time when many are preaching the virtues of an all-in-one digital entertainment centre for the home, Bruno has a rather jaundiced view of the concept. PC Authority asked him about whether Yahoo!7 was likely to make its multimedia content more friendly for a limited or low-resolution device. The outlook is not good.
“I just don’t think the Internet is ready for that (media centre experience) because the penetration of these devices is not there yet,” he said. He cited stories of disappointing products in the past which had under-developed user interfaces, caused by the lack of close cooperation with content providers.
Largest fish in the Internet pond?
With the face of Internet portals shifting rapidly, it’s difficult to say who Yahoo!7 is now competing against. Can it really match the post-IPO muscle of Google or entrenched players like Microsoft? Does it compete with publishing operations like PC Authority? When you compete in so many areas, defining your enemies is hard.
“[Our largest competitor is] I think definitely MSN. If we look overall, it should be MSN,” Bruno said. NineMSN in Australia is a joint venture which pools the content of MSN in the US and PBL (Publishing and Broadcasting Limited), which includes the Channel Nine television property.
Along the journey of Internet portals, there certainly seems to have been some casualties. “I would say in the past, [our competitor was] AOL,” Bruno said. Whatever happened to the once proud AOL?
“I don’t know.” he said, wistfully.
Bruno Fiorentini appeared at the Australian MediaConnect Kickstart conference.