Yahoo On the Mend?

Six months into her new job Marissa Mayer the new queen of Yahoo was able to tell some reasonably good news to investors in her Q4 results call yesterday. Yahoo saw their first uptick in revenue for a good while as Mayer shared the good news from the annual meeting of the great and good in Davos Switzerland last week. She pointed to two clear areas of focus for the newly invigorated Yahoo. Not surprisingly mobile is one of them. That makes a huge amount of sense as mobile is rapidly catching up with the desktop. For all its failing Yahoo has a ton of great content which million of people go to each day for their daily dose of sports, news gossip etc. Making that content mobile and personalized for their millions of users through apps and targeting ads around that offers a significant opportunity for revenue growth. However, the other focus Mayer pointed to is search….yes really search. I have been in the search business for about a million years and back in the day Yahoo powered its own search. Then they brought in the cuddly friendly guys at Google to power it for them (under a powered by Google brand) to run their search for them. Their assumption was that people would use Yahoo for everything including search. Back then before high speed connections users could either sit and wait for a yahoo results page encrusted with ugly ads to load or they could hop over to Google and have a fast clean ad free search result from Google. Weirdly I remember discussing this with several Yahooligans at the time and they honestly didn’t think it would be a threat. A decade or so later…they aren’t quite so sure.

Yahoo ceded search to Microsoft’s Bing a while back so for Yahoo to attempt to gain a stronger position in search without even owning the technology is incredibly ambitious. Doing search well is hard, doing it as well as Google does given the 30 trillion pages Google indexes is incredibly hard. Google has beaten off legal challenges for their rivals and the FTC and become both a noun and a verb…it’s tough to beat a competitor which has become the name for the activity. The mobile opportunity is probably more compelling. When I just checked there are about a dozen separate Yahoo apps out there. The question is can Yahoo weave those separate strands into a strong unique mobile user experience…before Facebook does? The jury is out on that. Certainly Yahoo has done a better job than Google whose mobile news app is just horrible. Their biggest problem is that Google has become the way that most of us navigate the chaos of the Internet and Facebook has become the way we share pics of our kids….all that’s left is mobile, and the clock is ticking on that too.

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