Archive for February, 2008

Microsoft & Yahoo, Giants & New England, Obama & McCain

Monday, February 4th, 2008

Tomorrow is Mardi Gras in my hometown of New Orleans.  On this day convention defers to imagination.  And plenty of conventional wisdom has stepped aside already this year: in sports, the seemingly unstoppable mastery of Roger Federer and that of the Patriots ended in startling fashion; in the presidential campaign, Obama seems to have surged into a dead-heat with Hillary; and John McCain, counted-out in October, is now the odds-on favorite for his party’s nomination.

So what is the wisdom of Microsoft’s bid for Yahoo and how might we benefit from this gamble as they try to prevent Google from doing to them what they did to AOL (America on Line).

– AOL’s model was to capture the customer in the AOL-only experience.  No need to ever leave the world of AOL, whether you wanted to or not.  Monthly fee revenue model.

– Yahoo trumped this model by providing a portal where Yahoo aggregated content developed by others around the Internet.  ‘No need to leave, we’ll bring it to you.’  Banner ad & pop-up revenue model.

– Google trumped Yahoo by using their search engine to take visitors all over the Internet where Google would keep track of their searches and visits to deliver related advertising.  Advertisers, not visitors, pay Google.

Let’s imagine what this merger might imply for our organizations aside from the reminder of the recent, sour history of such mega-merger attempts: e.g. HP & Compaq, AOL & Time Warner, Chrysler & Daimler.

The Internet’s emerging technologies and uses are evolving rapidly to being about:

Innovation not Integration by connecting like-minded people regardless of location or employer.  This is a design point for our systems and services.

Information not Application by connecting those who need to know with the content that they require.

Mobility and Advertising on the mobile device.  Remember AOL and its garden wall approach?  This is what the iPhone is doing to the garden walls of the Telecom companies.  Google, Yahoo, and Microsoft spent $10b here in 2007.

As Tuesday’s Rex parade circles Canal Street, the costumed crowd will shout the conventional “throw me something, mister!” Let’s imagine what other opportunities are in store for them.

Laissez les bon temps rouler!  Christopher Perrien