Fulfilling a second major part of its promise to make the internal workings of its Web site more extroverted, Yahoo is opening the interface for its address book for outside use.
The move could mean that Yahoo, struggling under business pressures but still a stronghold of Web activity, could become more tightly tied to others' Web services. For example, a programmer starting up a social networking site could use the interface to send invitations to a member's list of contacts stored at Yahoo.
"Our address book has for a long time been one of the top things developers wanted access to," said Chris Yeh, head of the Yahoo Developer Network. That's because, over the years, Yahoo users have filled it with billions of individual records.
Yahoo users have stored more than 500 million address books, and the service is used by more than 150 million unique users each month, Yeh said. "A lot of our address books (are) constantly being updated. It's one of the biggest sources of contact information on the Web," he said.
Opening the address book API (application programming interface) is the second major step taken so far in executing the Yahoo Open Strategy that Chief Technology Officer Ari Balogh announced in April. The first step, in May, was opening the SearchMonkey project so outside coders could make more creative use of Yahoo search results.
"The address book is the second proof point. This year, we'll show proof point after proof point," Yeh said.
Yahoo Open Strategy is an attempt to link the company more with other Internet activities rather than remain a sealed-off, if sprawling, Internet domain. Through its open strategy, the company envisions outside programmers building Web applications on Yahoo's site, Yahoo services being incorporated into outside applications, and social connection information within Yahoo being used more widely.
Whether Yahoo will succeed in capturing developer attention and becoming a more dynamic part of new developments remains to be seen. A lot of action--some complementary but much of it competitive--also is taking place at rivals such as Facebook, Google, and any number of small Web 2.0 start-ups.
From the outside looking in
The address book move means outside Web sites will be able to read and write address book information--if a user grants permission through a Yahoo authorization process.
A site with a gift registry could piggyback on the address book so that a person could tell contacts about a wish list of presents, for example, Yeh said. Or a site shipping packages to others could auto-complete the address fields on a Web form.
(And something I'd like to see happen: somebody please endow the address book with an interface that doesn't look like it dates from 1998. I have a lot of contacts stored away in the Yahoo address book, and I find it excruciating to update addresses, scrub out obsolete e-mail addresses, or update mailing lists.)
Explicitly opening the service is more secure than one alternative today, in which a third-party site asks a user for Yahoo log-in credentials so it can access the site and scrape the contact information.
"There's no control over what happens after a user gives that (username and password). The third party could use it to log in to mail or any other part of Yahoo," Yeh said. "It's not a real secure method."
Yahoo isn't opening up the interface for an address book creation, though, which means it won't at least for now be usable as a generic back end for a Web site's address book needs.
Social graph theft?
One interesting possibility raised by the openness is whether an outside company might use it to steal, in effect, a user's social graph--the collection of connections each user often must laboriously reproduce as he or she joins a new site. Social graphs are a key asset of Web sites with a social element, in part because it's hard to reproduce them elsewhere. So once a user constructs one, there's a strong incentive to remain loyal to a site.
Yahoo isn't concerned about that, in part because opening the interface will mean other sites will be able not only to extract contact information from Yahoo, but also to synchronize changes on their sites back with Yahoo, Yeh said.
"I don't think we're worried about losing control over our social graph. All the things we're doing now are trying to break down some of the traditional walls Yahoo has had to the outside world," he said. "Yes, absolutely some of our data will get pulled out and be used for benefit of other systems. (But) when people use our system address book APIs, there's just as much a chance somebody will load something back into our network."
One company making use of the Yahoo address book interface is Plaxo, which hosts 40 million users' address books already.
Yahoo itself maintains multiple social graphs--for example, the address book, the Yahoo Messenger buddy lists, and the Flickr lists of contacts, friends, and family.
"Not all this data is combined yet," Yeh said, though one key part of Yahoo Open Strategy is to unify these contact lists and the related user profile pages. "The goal of the next half year is to make sure we bring that together."
The Yahoo address book is the "place we like people to store all their contact information," he said, but it's not a terribly rich social graph. For example, it doesn't currently have a good way to distinguish which contacts would be appropriate to invite to a new social service or to receive gift registry notifications.
"One of the things that we have to do is give users and opportunity to activate their social graph a little bit--essentially, to make sure they can classify the people they're most interested in communicating with on a regular basis so we know how to create a social environment around them," Yeh said.
"Going forward, we'll have to have a better solution for people so we can classify inside our address book who we're closest to and who are at further distance from us," he added. "That's a function of the social work we're doing."
As Microsoft returns to the table with Yahoo for a deal that might include Yahoo's search business, Windows and Windows Live chief Kevin Johnson sent this letter updating his team on an updated online and advertising strategy. CNET News.com's Ina Fried had an exclusive report on May 7 regarding Microsoft's online search and advertising strategy.
Windows Live Chief Kevin Johnson.
(Credit: Microsoft)
From: Kevin Johnson
Sent: Sunday, May 18, 2008 1:30 PM
To: Platforms & Services Division; APSP FTE - Adv & Pub Solutions Platform; Employees.all.corp.adf@main.corp; Employees.all.adf@main.corp
Subject: Online Services Strategy Update
We have been executing against the core strategy I first presented at our Financial Analyst Meeting in July 2007 to go after the growing opportunity in online services and advertising. Four pillars have formed the basis of our strategy:
1. Consolidate ad platform and win in display
2. Innovate and disrupt in search
3. Deliver end-to-end user experiences across PC, phone, and web
4. Reinvent portal and social media experiences
We have many options that support acceleration of our strategy. As announced earlier today, we are also considering new alternatives for a transaction with Yahoo! which do not involve a full acquisition. At this time, we have not made a new bid to acquire all of Yahoo!, but we reserve the right to reconsider that alternative depending on future developments and discussions that may take place with Yahoo!, shareholders of Yahoo! or Microsoft, or with other third parties.
Regardless of the outcome of any new discussions, it is important that we continue to move forward to strengthen our online services business. The fact is that we are not where we want to be in this business yet and we've been in this position longer than we'd all like. To that end, we will be accelerating elements of our core strategy, and breaking ground in new areas.
On Tuesday, Brian McAndrews is hosting advance08, our annual advertising conference here in Redmond. Over 400 leaders from across the media, technology and advertising landscape will be here for two days to engage in dialogue on industry trends and opportunities. These leaders are some of our closest partners in the digital transformation of the advertising industry, and they recognize the increasingly important role Microsoft plays in this transformation.
We are very excited to have these customers and partners on campus.
Brian's keynote will highlight our unique position in the advertising industry. It's amazing to see how far we've come with the aQuantive acquisition in differentiating our advertising platform. This foundation is paying off, with Q3 advertising revenue growth of nearly 40%, a rate that has accelerated over the past two quarters while growth rates at Google, Yahoo and AOL have slowed.
On Wednesday, we will be announcing a major new initiative that our search teams have been driving. We are getting better and better with our core algorithmic search, and at the same time, we are investing to differentiate in vertical experiences and to disrupt the current model. You'll hear more about our plans Wednesday.
advance08 will underscore our commitment to search and online advertising, and you'll continue to see announcements demonstrating our progress in this space. Earlier this week, I spoke to leaders across our online services business about our core strategy, the importance of acceleration and a set of actions we are taking, including:
1. Innovate and disrupt in search - We will disclose some elements of our plans with this week's release of search and sharpen our focus on user experience and business model innovation. The work we have done over the last 4 years on search has established a solid foundation to build upon.
2. Win targeted distribution - With this release of search, we are now ready to throttle up broader distribution initiatives.
3. Reinvent portal and deliver new experiences across PC, phone and web - We are building our new releases of Windows 7, Windows Live wave 3, Windows Mobile 7, Internet Explorer 8, Search and MSN with an eye towards optimizing and unifying experiences and scenarios.
4. Fix our online branding - Our brands are fragmented and confusing today, and we recognize a need to clarify and align our online branding. We are now driving forward to address this opportunity.
5. Win in display advertising - We have an advantage in tools, agency assets/relationships and a team laser-focused on capturing the display ad platform opportunity. As we build from a position of strength, we will increase engineering resources to drive even more innovation.
6. Build on our strengths in Europe - As measured by comScore in March, our online business in Europe is doing well. We have over 3 times the page view volume and nearly 7 times the minutes of usage compared to Yahoo!, and 68% reach to internet users throughout Europe. We will double down on our investments in Europe and expand on this strong position.
7. Expand strategic partnerships - In addition to our organic innovation agenda, we will expand strategic partnerships that increase inventory on our display ad platform, enable new paradigms in search and accelerate growth in key geographies.
8. Pursue small, targeted acquisitions - Looking forward, we will focus on small, targeted acquisitions that support our work in search, complement our value in the ad platform and help us grow scale in key geographies. Recent acquisitions including Rapt and YaData are examples of these types of acquisitions.
The PSD leadership team is actively working on the FY09 budget, including resources and investments to support the actions above. Additional elements of our work will be revealed in the coming weeks, leading to our Financial Analyst Meeting in July where I will share more details on our strategy and business/financial outlook.
As we move forward, I want to remind everyone that we are well positioned to compete. We have some of the industry's best assets on our side: technical and business talent, global scale, a culture of self-criticism and tenaciousness, a healthy balance sheet and an unparalleled product portfolio. It's time for us to seize the opportunity.
Thanks again for your continued leadership and focus on our business. If you have any feedback or thoughts, please feel free to send me mail.
Regards,
Kevin Johnson
Following earlier news that Microsoft was recalculating its $44.6 billion bid for Yahoo, it has become clear what the company has decided to do. Microsoft has thrown down the gauntlet, as evidenced by a letter Saturday from CEO Steve Ballmer to Yahoo's board of directors. Here's the quote that sums up the entire letter:
"If we have not concluded an agreement within the next three weeks, we will be compelled to take our case directly to your shareholders, including the initiation of a proxy contest to elect an alternative slate of directors for the Yahoo! board."
Microsoft's big bid for Yahoo
This certainly is sending a strong message to Yahoo that almost nothing can be done to derail Microsoft's acquisition of the company. Rubbing salt into the wound, Microsoft adds, "It is unfortunate that by choosing not to enter into substantive negotiations with us, you have failed to give due consideration to a transaction that has tremendous benefits for Yahoo!'s shareholders and employees," in an attempt to stir up a response from Yahoo's board.
Since everything has been laid out and is now on the table, we are in for a very interesting three weeks. A hostile takeover of Yahoo would be really ugly and you can bet that Microsoft does not want to take that route, but it appears that they will if they have to.
Updated March 22, 2008. Edits explained at the end of the post. - ST
I was reading a news item about the resignation of Mathstar's chief financial officer. I was surprised to see a publicly traded semiconductor company I'd never heard of, so I checked it out.
Turns out that Mathstar is like a number of companies I've come across over the years: they come in under the radar screen and, as such, investors think they've found something special.
Sure, these companies are special, but not in a good way.
(Credit:
Mathstar)
Mathstar markets itself as a development-stage fabless semiconductor company. Its products are called field-programmable object arrays, or FPOAs, and are targeted at high-performance, data-intensive applications like defense, security, medical imaging, and video.
Sounds good, right? ... Read more
How do we value technology companies? Ingenuity and invention, quality of service, brand loyalty, manufacturing muscle, operating efficiency, supply-chain management, price, great place to work. There are lots of metrics.
For those unfamiliar with the wily ways of Wall Street, the stock market has its own way of expressing what it thinks of companies. It's called market capitalization or market cap for short. ... Read more
Crises happen. They happen to all companies and to all people. They happen in our personal lives and in our professional lives. By definition, crises bring change, big change. They can change the entire trajectory of your life or your company's future. That's why how we behave in a crisis, how we manage a crisis, is such a big deal.
For example, Yahoo is going through a crisis right now. It's attempting to reinvent itself. Microsoft's bid to buy the company further complicates matters. The way Yahoo's board handles this crisis will determine the fate of the company and its thousands of employees and shareholders. That's a pretty big deal.
One company's crisis can have a ripple effect on others. You might say that Microsoft is attempting to capitalize on Yahoo's crisis. In so doing, the software giant has created its own. Negotiating tens of billions of dollars to acquire a large company and remake its Internet business is definitely crisis material. ... Read more
Just about everyone else on the Internet has written on the potential acquisition of Yahoo by Microsoft for $44.6 billion, but I thought that I would weigh in on what I think this might mean for search and Web services.
According to ComScore's search share numbers for December 2007, Google has 58.4 percent of the market share, with Yahoo and Microsoft trailing at 22.9 percent and 9.8 percent, respectively. If Microsoft and Yahoo combine forces and change nothing, that will put them at 32.7 percent to Google's 58.4 percent. While those numbers are certainly not enough to overthrow Google, maybe the combined minds at the two tech giants can come up with something. Somebody has to try to make a stand, so that Google doesn't run away with the industry completely. That said, I think that Google is here to stay, even though this may be its biggest challenge yet.
On the Web services side of the issue, this acquisition is looking really good for Microsoft and Yahoo. Long Zheng has a great rundown of the services that Microsoft and Yahoo provide and where they overlap. The combined user bases of Microsoft and Yahoo's Web mail services far outpace that of Gmail (they actually both beat Gmail individually), so we will put one in the win column there. If Google Talk wasn't dead enough before, it sure will be now. Google has not even come close to touching either Microsoft or Yahoo in the instant-messaging market. One more thing on IM, if this acquisition goes through, a little service called AIM is going to finally be in their sights.
Microsoft will benefit from taking control of the leading photo-sharing site, Flickr, since its only photo-sharing solution that currently exists is through its Windows Live Spaces product. Several services from the two companies will likely be merged down the road, such as Upcoming integration in Live Events, Yahoo Widgets being integrated into the Vista Sidebar, and a merger of Yahoo Answers and Live QnA. Services that are likely to get the axe include Yahoo Maps, since Microsoft's Virtual Earth technology far outperforms Yahoo's, Yahoo 360 (or whatever it ends up being once it is done "transitioning"), and most likely some of Yahoo's music services.
$44.6 billion is a lot of money to pay for an acquisition, but Microsoft has deep pockets. The deal initially makes me a little nervous, but after thinking about it for a little while, I am feeling better about it. I'm not convinced that Microsoft will take away Google's search crown as a result of this acquisition, but it will instantly become a larger player. This acquisition will lead to almost complete dominance by Microsoft over Google in the Web services arena, but not necessarily in search.
Note: I wrote this on Thursday before Microsoft's latest bid for Yahoo; it's a follow-up to a post I wrote six months ago. I have two comments on Microsoft's offer: 1) It's aggressive and it's a sweetheart deal for Yahoo's shareholders; I think Yahoo's board will accept it; and 2) nevertheless, the issues I present are the same; it just becomes Microsoft's problem.
It's been seven months or so since Yahoo chief and co-founder Jerry Yang replaced Terry Semel at the helm of the ailing internet giant. At the time, I pondered the obvious question: Can Yang fix Yahoo?
For the record, I thought the board acted rashly in appointing Yang--a relatively inexperienced executive--to perform what would clearly be a challenging turnaround. I didn't think he had the experience to pull it off.
At the time, I thought that Yang--a visionary--wasn't what Yahoo needed. I thought Yahoo's problem was largely failed execution and missed opportunities in search advertising that allowed Google to leapfrog its more mature rival.
At this point, I'm even more convinced that Yang was the wrong choice. But I think the problem is bigger than missed opportunity and failed execution. The company does indeed need a new vision. And it needs a CEO who's capable of articulating and selling that vision down through the ranks and ensuring everybody's goals are aligned.
That's a tall order, but it can be done. Lou Gerstner did it at IBM, and that was no walk in the park. But Jerry Yang is no Lou Gerstner. ... Read more
I don't know how many times I've read a post or an article by some small-minded, self-important journalist advising a public company's board of directors on how to "fix" the company. The most common advice is "sell the company," "fire the CEO," or better still, "fire all the executives."
Even if a company is screwing up, how is a journalist--whose entire management experience consists of looking at his watch to be sure he files a story by 3 p.m.--qualified to dole out management advice? Is mastery of a keyboard sufficient experience to know how to run a company?
... Read moreOnce upon a time there were no iPods, iPhones, Xboxes, Blackberrys, or Tivos. Really, I'm not kidding. There were PCs, though. And they were really expensive. But we didn't have anything else to spend our money on, so that was OK. We paid $2,000 for our PCs and liked it.
Back in those days, there were three microprocessor companies--Intel, AMD, and a little Texas (it's an oxymoron, I know) company named Cyrix. If you don't recognize the name, that's because Intel had such a lock on PC makers back then that Cyrix's processors were sold primarily through the third-party reseller channel.
It's a popular misconception that Cyrix "cloned" Intel's processors. Cyrix's processors were actually all original designs. In fact, Cyrix's manufacturing partners--initially Texas Instruments, later IBM and ST Microelectronics--licensed Cyrix's designs for their own branded processors.
... Read more
