Yahoo: Goodbye Bartz Hello Baidu or Apple

In yet another mystifying move, Yahoo’s board fired Carol Bartz and ended her three year tenure as CEO.  Over the last three years, Bartz has had to clean up after the less than stellar leadership of both Jerry Yang and Terry Semel led to revenue slowdowns, management bloat, product missteps, and who knows what else.

While I’m saddened to see Bartz go, I’m more aggravated by the ridiculous articles and blogs regarding Yahoo’s past, present, and future.  Note to the mainstream press…Yahoo IS NOT Google.  Yahoo is NOT Facebook.

Yahoo IS an Internet icon, a portal destination, an information and communications hub, and is chalk full of popular services and offerings.  Often seen as less innovative than Google, Yahoo has made meaningful contributions to Hadoop and has recently open sourced Traffic Server which was acquired as part of the Inktomi acquisition.

I see two paths for Yahoo; Baidu and Apple.

Baidu has grown into a formidable challenger to Google.  For Baidu to take the next step they must enter the Western marketplace and Yahoo would be the perfect vehicle to make this a reality.  A cash and talent infusion by Baidu would reinvigorate Yahoo giving it new life to innovate and disrupt its way to revenue growth.  It would also mean an end to Yahoo’s partnership with Microsoft (or would it) as well as new competitive efforts across traditional and mobile solutions.

Apple is a dominant force within the mobile/tablet community and Yahoo would make the perfect destination for their users.  With one brush of the pen, Yahoo would be folded under the Apple brand and would change the perception of Yahoo from old/dying to new/exciting.  Apple could use Yahoo as a platform for iCloud services and revamp Yahoo’s offerings to work seamlessly within iOS and OSX.  Additionally, Apple could use Yahoo to offer new and innovative Cloud services and accelerate the adoption of HTML5.

In the end, Bartz will come-up a winner in this mess as her honesty and toughness is refreshing.  However, the future for Yahoo may be bright as long as the Board realizes it’s time to turn the reigns over and sell the company.  Let’s hope they don’t turn down an offer like they had from Microsoft again and Yahoo finds a new home!

Fun Alert: Insane 2011 Predictions That May Come True

Google Acquires Level 3 Communications

Really?  Forget net-neutrality, think fiber and capacity management.  Google gains a worldwide network and a host of services and options to redefine the Internet.  Google’s itching for another industry to transform, and the service provider market is ripe for the picking.  By streamlining processes, costs, and creating a true cloud, Google can change the game while laying the foundation for some incredible mobile products and services.

Apple Acquires Sony Corporation

Why?  How about content, home entertainment, consumer electronics, and more.  Imagine Sony TV’s pre-loaded with Apple TV or PS3 with an ‘Apple-like’ interface.  Apple would gain content via Sony Pictures, cameras, a massive distribution channel, and control of standards, patents, and more.  In the end, Apple would restore Sony to their former glory while drastically expanding their breadth and depth of products.

Cisco Acquires SAVVIS

Huh?  As Cisco is dead serious about the cloud and Infrastructure as a service, purchasing SAVVIS would give Cisco a ‘enterprise-class converged cloud solution.’  Plus, SAVVIS is a huge Cisco customer and early adopter, so Cisco wouldn’t’ need to swap out hardware as UCS is already in-play here.  Cisco gains data center expertise, IAAS, SAAS, Hosting, Content Management, and more while moving ever closer to end-customer and consumer.

Dell Acquires Brocade

Are you kidding me?  Dell needs an Ethernet and storage networking presence and they need it right now.  By purchasing Brocade and integrating their product sets, Dell can finally go toe-to-toe with HP and IBM.  Additionally, Foundry products finally get the sales and distribution channel they need to compete with Cisco, HP, and Juniper.  Dell would streamline manufacturing, sales, marketing, and more to create a viable alternative to HP’s growing ProCurve business.

Baidu Buys Yahoo

Never!  Baidu (the student) comes into the US Market flush with cash to buy Yahoo (the teacher).  Baidu would gain a US presence while putting their thumb in Google’s eye.  Yahoo gets an injection of cash and swagger, as they focus on platform services and open source projects.  Meanwhile, Microsoft quietly wins here as they continue to work with Yahoo/Baidu and expand their Chinese presence.

Huawei Buys Juniper

Come on?  Shunned by Dell, Juniper has little options as IBM refuses to enter the networking hardware business.  Huawei desperately wants to enter the North American Market, and Juniper’s name and mix of service provider and enterprise customers are just the ticket.  Huawei would quickly ramp up Juniper’s product line while introducing new lines of business including wireless carrier infrastructure, storage networking, and more.

Oracle Buys NetApp

Finally something we can agree on!  While Oracle/Sun have some amazing storage products, NetApp gives Oracle legitimate world-class storage solutions.  Oracle could leverage NetApp within their next generation ‘Exa’ products while refining how Oracle products perform on NetApp storage.  Meanwhile, Oracle/NetApp will make billions from FlexPods while moving closer to Cisco.

Apple’s Next Move; Buy Yahoo

It seems like only yesterday when the world wasn’t quite so complicated. When good vs. evil was as simple as Apple vs. Microsoft. With the rise of the Internet came the birth of a whole new paradigm of communicating and sharing information. Proprietary software has new open source challengers that are surprisingly refined while continuing to expand their capabilities. Client/Server gave way to Web based user interfaces and the deliver of legacy software is giving way to the cloud. The desktop has been replaced by the laptop, the cell phone became a mobile device, and Apple has become a powerful force within computing, music, video, mobile devices, and more. However, once again the world has changed and Apple must adapt to face a new challenge; Google.

Once upon a time Apple and Google were friends with a common enemy and clear boundary lines. Today, those lines have been crossed and they are headed on a collision course. Apple didn’t start this skirmish, but they did create an inflection point that has become a clear threat to Google’s future. The rise of OSX, iPod, iPhone, iTunes, and now iPad, flew in the face of Google’s Internet vision centered around their cloud. Google risked losing control of the end-user platform and the advertising revenue they covet; they had no choice but to stop Apple’s momentum. Therefore, Android, Chrome, and Chrome OS were born.

While Google is on the offensive, Apple continues to chart their own course. However, this changed when Google released the Nexus One and then snatched AdMob from Apple’s hands forcing them to settle for Quattro Wireless. This skirmish is now an old fashion feud and may escalate into an all out war. Maybe that’s why Schmidt met with Jobs last Friday to attempt to deescalate the situation, but remember that Jobs never yielded to Gates. If Apple wants to attack Google, then look no further than Yahoo as a perfect takeover target.

Apple would not be buying Yahoo for search, that’s Microsoft’s problem. Instead, Apple would be gaining a cloud and advertising platform for which they could re-launch current Yahoo services, build on Yahoo’s mobile and location based strategy, and integrate current Apple offerings. Imagine a new Yahoo that has been injected with Apple’s DNA and provided innovative services and content for Apple’s computing and mobile products. How about a cloud based iTunes Store, the merging of Flickr with iPhoto, or Time Capsule based back-up in the Cloud. I shutter to think how Apple could redefine and reinvigorate Yahoo.

Consider this, Yahoo is still the third most popular website on the United States. Yahoo’s problem has never been visitors, instead it has always been the monetization of their incredible content. Does anyone doubt Apple’s ability to introduce new and innovative business models to the market? Additionally, Yahoo’s Fire Eagle location-based service would be downright explosive in Apple’s hands.

As Jobs rightfully stated, “We (Apple) did not enter the search business. They (Google) entered the phone business.” Now is the time for Apple to take their massive following, passion, and ability to invent ground breaking intuitive technology and attack the advertising revenue that is at the heart of Google’s dominance. The centerpiece of such an attack is the purchase of Yahoo serving as a catalyst for Apple’s continued domination of the mobile space.

2009: We Fooled You

As 2009 comes to a close, below is my very incomplete list of top “we fooled you” moments of 2009.

  • Cloud Computing trumps everything
  • Virtualization renders the OS irrelevant
  • Google “does no evil”
  • Cisco can’t grow or compete
  • Outsourcing isn’t forever
  • Chrome is better than Firefox or IE
  • Storm / Android beats the iPhone
  • Bobby (Foundry) would never sell
  • Huawei will falter
  • HP can’t catch IBM
  • IBM wouldn’t get back into networking equipment
  • Sun is dead
  • Open Source Software kills ISVs
  • Open Source Hardware dominates storage
  • Free Software – LOL
  • PBT vs. MPLS
  • Nortel would be saved
  • Web vs. traditional advertising
  • Juniper would never enter switching
  • Oracle is just a database company
  • Apple vs. Microsoft
  • Dell doesn’t care about services
  • IPOs are dead
  • Facebook is a fad
  • LTE is years away
  • Cisco UCS crushes HP, IBM, Dell, and more.
  • Business Intelligence wars would end
  • IPv6 – enough said
  • All start-ups need traditional VCs
  • Internet / IP Security is solid
  • Google Apps ends the need for Microsoft Office
  • Yahoo is dead
  • Linux Desktop vs. Apple and Microsoft

2009 was both an exciting and frustrating year for technology.  The battle lines are drawn for 2010 and I’m looking forward to a great and surprising year.

Happy New Year!

Forget Google Chrome OS: Root for Microsoft, Apple, and Linux

Yesterday, Google announced their intention to release a new operating system designed primarily for Netbooks.  The new operating system, Chrome OS, will now compete against established Linux vendors as well as Microsoft for market and mind share.  While the initial reactions to this announcement were positive, I have a different spin.

This announcement underscores a major challenge at Google; they are a “one trick pony”.  Google is simply a giant advertising machine that needs critical inputs regarding our personal information to better serve their advertising clients.  While many individuals cling to an unhealthy affection towards Google, the truth is Google provides its services, search, mail, calendar, gears, etc. not for the sake of good, but for the sake of money.

At first, Google was satisfied with the collection of information via third party web browsers such as Firefox and IE.  However, their hunger for personal information led them to release an even more intrusive technology; the Chrome browser.  Now they crave even more information that can only be obtained via having access to everything; the Operating System.  By collecting all this personal information, whether it is scrubbed or not, Google can better profile its users and charge more to its advertisers.  It’s not simply a numbers game any longer as the quality of the information about your user population is as, if not more, important then the quantity; a lesson Facebook plays perfectly.

I’m rooting for Microsoft, Apple, and Linux to put Google’s Chrome OS back in its preverbal box. Google can keep Android, Chrome, Desktop Search, and anything else they desire to load on my personal computers to themselves.  Does anyone seriously think Microsoft did not see this coming?  If Apple released OS XI generically, would anyone care about Chrome OS?  Will Chrome OS make a dent in the fiercely loyal and growing Ubuntu population?

Google’s corporate motto may say “Don’t be evil”, but that’s like the pot calling the kettle black.  One person’s road to Evil is another one’s road to riches.

Sun: Are you nuts?

Major media news source are reporting that IBM’s purchase of Sun has cooled-off as Sun has rejected IBM’s $7 Billion purchase price. Many are comparing Sun’s decision to that of Yahoo’s to rebuff Microsoft’s purchase of the company. However, Yahoo is still the number one destination on the Internet while Sun is losing market and mind share.

Perhaps the leadership at Sun needs to look at a calendar and realize that the year is not 1990. Sun is not high flying, SPARC is not dominant, SOLARIS has lost steam, StorageTek didn’t pan out, the jury is still out on MySQL, Java is great but where’s the revenue, and their current open source push into virtualization is admirable but risky.

It pains me to watch a once great company with talented and dedicated employees continue on a march to extinction. I am a fan of Sun as I earned my Unix stripes on SOLARIS and SPARC systems. I am avid supporter of VirtualBox, OpenOffice, and Java. Additionally, I have been following Sun’s efforts to redefine the datacenter and cloud computing.

While all of these efforts are exciting and some are technically superior to the competition, Sun has lost the ability to move markets and create new paradigms. Let’s face it, to the dedicated individuals at Sun $7 billion is insulting. However, joining forces with IBM is better than continued layoffs, broken promises, and missed opportunities.

MSFT and YHOO: Does it make sense?

I have to admit that I love watching the Microsoft, Yahoo, and AOL saga unfold.  What is of peculiar interest to me is the number of industry analysts, pundits, and writers that seem to know absolutely nothing about technology, let alone business, that continue to write absurd articles about the validity of a Microsoft merger.  Outside of Carl Icahn’s arguments regarding shareholder value, does a Microsoft acquisition of Yahoo make any sense?

Yahoo’s strength lies more within their portal and less within their search and advertisement placements.  A fact that Yahoo themselves have recognized via their proposed link with Google AdSense.  As a destination, Yahoo is “first-rate” with limited competition.  From Yahoo News and Finance, to Instant Messaging and Email, Yahoo is a truly a remarkable destination.  However, their search and advertising business leaves a lot to be desired.

Back-in-the-day, Google became a giant by having relevant search with limited advertising.  In fact, Google’s search was so accurate that while employed by Inktomi, a rival to Google, many of us used it instead of our own search technology.  Google’s genius was creating a revenue platform around their search technology that continues to generate billions of dollars a year.  Yahoo tried to counter Google’s superior technology by purchasing both Inktomi and Overture.  Sadly, history won’t be kind to either of those decisions.

Examining Microsoft yields many concrete comparisons to Yahoo.  Microsoft is a decent portal destination with a wide array of on-line services.  However, their search and advertisement placements are horrible.  Microsoft attempted to correct the situation by engaging in a massive engineering and development effort culminating with the launch of a “new” search engine and purchasing aQuantive.  However, neither of these moves has made a dent in Google’s armor.

Simply put, Google’s search experience is superior to both Microsoft and Yahoo.  It’s clean, fairly relevant (getting worse), and extremely useable.  Additionally, Google’s AdSense and accompanying management tools are miles ahead of both Yahoo and Microsoft.  Therefore, why does a Microsoft and Yahoo acquisition make sense?

Combining Microsoft and Yahoo’s sub-par search engine technology is complicated and the results are sure to be uninspiring.  Furthermore, the same can be said of a combination of their respective advertising systems.  Unfortunately, this is not a math problem and the combination of these units does not equate to generating long term revenue success.  How hard is it to switch from Yahoo to Google or Microsoft to Google advertising? 

Have we forgotten that Microsoft maintains a healthy business that is growing revenues and continues to compete across multiple markets?  They have billions of cash in the bank with billions more arriving every year on the heels of new and updated products that are beginning to hit the market.  The perceived and overblown rivalry between Google and Microsoft is ridiculous.  Google needs more products, new ideas, and years of prolonged growth to even get into Microsoft’s league (I’ll leave that to another article).

While a combination of Microsoft and Yahoo would surely line the pockets of large institutional investors, investment banks, M&A advisors, and Carl Icahn himself, it only makes sense if their intent is to combine the portals and ditch the rest.  Based on Microsoft’s latest offer and Icahn’s stated plans,  this acquisition makes no sense.

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