After reading the details of the deal Microsoft struck with Yahoo! today, it looks pretty clear to me that the only real winner is going to be Google in the long run. Here’s why.
First of all, I’m not at all convinced that advertisers will be more motivated to put their money into AdCenter, contrary to what some predicted. To be a leader in the search and search advertising market today is not just a matter of “technology”, “scale” and “salesforce”, as Steve Ballmer seems to think; it takes innovative ideas and a company full of brilliant and motivated people to deliver the most relevant results to searchers and the highest possible return on investment to advertisers. And there’s no way that Microsoft can become that company: search has never been (and will never be) their core business, and despite their late efforts and mammoth investments in human resources, technology and R&D over the years, they have failed to come up with a decent search product so far.
I also believe this partnership will not lead to a stronger player in the search engine scenario, because Yahoo! will soon stop innovating —which means death. Today is indeed a very sad day for Yahoo! Search (RIP), and for Yahoo! as a company as well. To license give away their core technology to Microsoft for ten years is not just a very bad deal for Yahoo!’s investors (which didn’t like today’s news very much); it’s mainly a colossal strategic mistake: it means to give up on search, excising the company’s cultural roots. Over the next two and a half years “many Yahoo! Search employees”, said Yahoo! CEO Carol Bartz, “will be asked to take jobs at Microsoft”, while others will simply become “redundant”. Well, if I were a Yahoo! Search engineer today, confronted by the perspective of having to choose between getting nuked and surrendering to assimilation by Microsoft, I would already be exploring my alternatives.
To Google’s ears, Yahoo!’s backdown from the search battlefield must sound like excellent news, essentially because there’s going to be one less competitor in that arena. They won’t have to ditch any plan or alter their strategy. In fact, they don’t have much to worry about, except staying focused on their true mission: to organize the world’s information and make it universally accessible and monetizable.
The search battle is over, true. But Google won a long time ago.
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What can you expect carol has no passion for the company just another ceo replacing one that had passion but all the money people booted him out. Ah well.