Yahoo, Game Over

  |  April 19, 2001   |  Comments

Yahoo!'s role was always simple -- to lead and ride the boom. But now that the boom's over, Dana says the handwriting is on the wall.

I don't care what they say. Within three months, Yahoo will be merged out of existence, or within six months, it will simply be gone.

I'm sorry, but Terry Semel is no long-term strategist. He's a quick buck, a suit with ties to Big Media looking for a buyout. My guess is that he'll try to get a bidding war going among ABC, Fox, and Barry Diller's USA Network. But I wouldn't bet on a big premium -- I wouldn't even bet on a premium over today's stock price.

The handwriting has been on the wall for Yahoo ever since Tim Koogle announced recently that he would step down.

Koogle was a one-trick pony, and for years it was a pretty good trick. The trick was to create page views and sell banner ads on them.

The more page views Yahoo had, the more banners it could sell. That drove Koogle to offer free email, then to acquire such companies as GeoCities, eGroups, and Broadcast.com. Yahoo Store was, like the others, just another way to make money from others' content, not create anything original that Yahoo would own. Koogle was never interested in creating original content for Yahoo, so when his trick stopped working, he had no other value to offer. He had to go.

Despite the fact that Jerry Yang and David Filo created Yahoo (Yet Another Hierarchical Officious Oracle) while grad students at Stanford, Koogle was always the King on Yahoo's growing mountain. Well, gang, Elvis has left the building.

Every move made since Koogle's announcement has been aimed at making Yahoo just another minor media property. Its recent move against porn merely copied one made by InfoSpace three years earlier. The widely trumpeted move to charge for phone-related services was a head fake -- there are just too many "for free" alternatives.

Does Semel have any moves to play? He can try to get the international operations back on track. Japan is a bright spot, but there are empty suits to fill for Asia, China, Europe, and Korea, not to mention the top ad-executive slot. Every GO and NBCi executive failure (except Patrick Naughton) should now be at a dry cleaner's wishing on those jobs.

But other than window-dressing, I don't see any great cards left for Semel to play. Yahoo's role was always simple -- to lead and ride the boom -- and now that the boom's over, so is the game.

Many of you readers will think this a sad article when, in fact, it's just an object lesson and a great opportunity. Idiots will write that there's no chance to build a new Web brand, but Google has arisen in just the last few years.

And when the next shoe drops, remember what a friend of mine said when Microsoft acquired LinkExchange a few years ago. While others were moaning that the Redmond giant had taken over the affiliate marketing space, my friend clapped his hands with glee and said, "That's one more competitor gone." He was right.

ClickZ Live Toronto Twitter Canada MD Kirstine Stewart to Keynote Toronto
ClickZ Live Toronto (May 14-16) is a new event addressing the rapidly changing landscape that digital marketers face. The agenda focuses on customer engagement and attaining maximum ROI through online marketing efforts across paid, owned & earned media. Register now and save!

ABOUT THE AUTHOR

Dana Blankenhorn

Dana Blankenhorn has been a business reporter for more than 20 years. He has written parts of five books and currently contributes to Advertising Age, Business Marketing, NetMarketing, the Chicago Tribune, Boardwatch, CLEC Magazine, and other publications. His own newsletter, A-Clue.Com, is published weekly.

COMMENTSCommenting policy

comments powered by Disqus

RELATED READING

Information currently unavailable

ClickZ Today is our #1 newsletter.
Get a daily dose of digital marketing.

COMMENTS

UPCOMING EVENTS

Featured White Papers

ion Interactive Marketing Apps for Landing Pages White Paper

Marketing Apps for Landing Pages White Paper
Marketing apps can elevate a formulaic landing page into a highly interactive user experience. Learn how to turn your static content into exciting marketing apps.

eMarketer: Redefining Mobile-Only Users: Millions Selectively Avoid the Desktop

Redefining 'Mobile-Only' Users: Millions Selectively Avoid the Desktop
A new breed of selective mobile-only consumers has emerged. What are the demos of these users and how and where can marketers reach them?

Jobs

    • Contact Center Professional
      Contact Center Professional (TCC: The Contact Center) - Hunt ValleyLooking to join a workforce that prides themselves on being routine and keeping...
    • Recruitment and Team Building Ambassador
      Recruitment and Team Building Ambassador (Agora Inc.) - BaltimoreAgora, www.agora-inc.com, continues to expand! In order to meet the needs of our...
    • Design and Publishing Specialist
      Design and Publishing Specialist (Bonner and Partners) - BaltimoreIf you’re a hungry self-starter, creative, organized and have an extreme...