While Google leads the way with search and advertising dollars, Yahoo is trying to establish its unique market position with a new tagline: “To connect people to their passions, communities, and the world’s knowledge.”
Google's tagline--"Organize the world's information and make it universally accessible and useful"--recently augmented with "Search, Ads & Apps," is a bit more straightforward.
But both Yahoo and Google, as well as Microsoft, are heading in the same direction ultimately, beyond organizing the world's information or simply connecting people to the world's knowledge.
The current state of the Web, as I posted about earlier this week, represents the first stage of cyberspace colonization. It began with the browser and getting information online, and was followed by a first wave of colonizers, such as Yahoo, MSN, and Google, creating destinations oriented around Web search and then connecting people via email and instant messaging.
The Web has now grown into a community space with populous colonies, like MySpace and Facebook, sprouting up that intimately connect people in a social Web. They are trying to increase members, connect them within their walled gardens and build out features as fast as they can to create barriers to entry and profits. As part of the ongoing colonization of the Web, Microsoft, Yahoo and Google are going to end up competing over acquiring Facebook or other sites to retard the growing strength of News Corp.'s MySpace.
Yahoo is trying to transition from that first stage of colonization, when a few portals dominated, to this next phase in which Google dominates the search landscape and MySpace dominates the social Web. Long term, Yahoo needs to have a healthier slice of those activities.
Jeff Weiner, Yahoo's head of the Network (including Mail, Messenger, Groups, Flickr, Bix, Search, Answers, News & Information, Entertainment, home pages and My Yahoo), used more than 1,300 words in his post, "Mission as strategy--connecting the dots at Yahoo!," to explain how Yahoo plans to move forward.
His post is an explication of the new Yahoo tagline, starting with "connecting people," which means "connecting our consumers to their most essential needs, connecting our advertisers and publishers to their most valuable consumers, and connecting the dots internally to create far greater efficiencies and fully leverage the company’s strengths."
The idea of connecting people is not a differentiator, although Yahoo has the advantage of 500 million users, many of whom do more than search and email.
Connecting people to their "passions" requires understanding the intentions of users and having the technology to deliver results, Weiner said:
The key going forward will be to continue to expand these technologies to virtually every pixel we can improve on the Yahoo! Network. In other words, we want to connect the right user to the right content at the right time. If we get this right, the implications are considerable.
Again, not a strategic differentiator unless Yahoo can deliver palpably better results than competitors without sacrificing speed and simplicity.
Weiner admitted that serving up highly relevant content and anticipating user needs, is more of vision at this point. The same could be said of every other major player. Yahoo, like Microsoft, is loading up on scientists to improve its search capabilities, in an attempt to gain back share from Google, which captured about 65 percent of search in the U.S., compared to Yahoo's 10 percent, in recent months.
Connecting people to their passions, or what they want to know, is a largely a science problem and Microsoft and Google are also well armed to make progress on that front as well. All the colonies and inhabitants will benefit from the multiple research efforts to provide more relevant and personalized content and services, but it's not a competition that will change the balance of power in the near term.
It's in the community aspect or social Web that Yahoo has a chance to bring differentiation. Throughout its history, Yahoo has been focused more on creating a portal, a digital hub for Web users. Weiner talked about community as "creating better user experiences not simply by knowing what you want, but also by leveraging who you know." He pointed to Yahoo Mail's address book or the Yahoo Messenger contact list as examples of people connections, but they are from the first phase of colonization. He didn't mention MyWeb or Yahoo 360, which never had much of a pulse. Check out Weiner's 360 page, which hasn't been touched in over a year.
Weiner mentioned hiring a social scientist--Duncan Watts from Columbia University--as part of Yahoo Research and developing some "exciting new community products." One of Yahoo's problems is that it has several community-oriented services--Flickr, Groups, Bix, Answers, instant messaging--but they are very loosely connected, compared to the way hubs like MySpace or Facebook have been built from the ground up as collaborative environments.
Certainly having research scientists to understand collective dynamics is useful, but I don't believe the Mark Zuckerberg of Facebook spent a lot of time studying group behavior, going to lots of meetings or thinking about matrixed management to start Facebook.
Yahoo lives with the idea that it has Flickr and some smaller social plays like MyBlogLog and 500 million inhabitants who could be harnessed into a giant social Web if they can only figure out the right products and strategy.
As we have seen, the social Web is not coming from Yahoo, Google and Microsoft, but from MySpace (not under News Corp.), YouTube (now under Google), Facebook (available), and Twitter and thousands of others.
If Yahoo wants to win on the community front, it has a build versus buy option, unless someone else takes Facebook off the table. Maybe Yahoo has a long-term plan, and will develop the social Web service that replaces MySpace and Facebook a generation in the future, just as the two upstarts are supplanting Yahoo's community efforts. Admittedly, MySpace and Facebook attract the younger generation mostly, but they are the demographic that is leaning into the Web and pushing it forward.
Finally, Weiner explained what it means to connect people to the world's knowledge"
...we want to leverage our assets to build the most relevant, comprehensive, dynamic, and open repository of knowledge and content on the Web. One of the things we’re most excited about is the concept of “open,” and all of the potential we have yet to tap by opening up some of the most trafficked pages on Yahoo.com to the highest quality publishers on the Web, regardless of their size.
He went on to say that Yahoo's start page reaches 40 million unique users per day. That's a lot of eyeballs, but eyeballs do not make a thriving community of connected people who are passionate about their chosen digital colony.
At then end of the day, Weiner has shed some light on the mission, but not much on the real strategy for what I call colonizing the Web, which includes connecting people to whatever content or services they need, and also importantly, the community hub at the center of their digital lives. What is Yahoo's plan for extending its reach and connecting the dots among all its islands of users and content?
Weiner ends his missive with reality and a challenge to himself and his company:
Any strategy, no matter how good it sounds in theory, is only as valuable as its ability to be executed.
Photo credit: Dave McClure