How frickin’ exciting!

I understand that they are looking to create a competitor to Google in both search and advertising, but the “price paid” seems very high – at least on the part of Yahoo.

Major terms of the deal:

• Microsoft will be powering Yahoo search
• Microsoft have licensed Yahoo’s search technology for 10(!) years
• Microsoft will run paid search via their search engine
• Yahoo will be providing the advertising sales force for their combined “paid search” capability
• Each company will still maintain separate advertising sales forces for other advertising
• They enter a revenue sharing agreement, but Microsoft guarantee Yahoo will get at least existing revenues for the next 18 months
• Microsoft pay most of its traffic acquisition costs

So, boiling it down, it appears Yahoo are giving up their search engine technologies (for at least 10 years) in conjunction for (at least current) revenues to be paid by Microsoft for algorithmic search advertising.

Microsoft have to maintain a sales force to sell other advertising, so they aren’t saving costs there. They are still having to maintain search so they aren’t saving costs there. They are paying Yahoo for traffic acquisition, and revenue for algorithmic search advertising, so they are losing money there. Their benefit seems to be

1. Acquisition of a license for Yahoo’s search technology – given they’ve just released their own shiny new engine, is this an asset or liability?
2. Traffic – this is what Microsoft are in the deal for for. Traffic from Yahoo.

10 years is a long time. Search changes a lot in 10 years. Google was only just starting out 10 years ago. Altavista (at least where I was using the web) was top dog back then. I’d be interested to see if Yahoo are going to maintain their search technology, or just let it die off. Is this a sign that they no longer want to compete in search, but be a destination that pulls together other properties (harking back to their very early days I guess). I guess time will tell if Yahoo’s apparent specialisation strategy was a sensible or dumb move. Microsoft are banking on Bing becoming a google killer, or at least a serious competitor, in the long term. They also apparently believe that paid search results are the way of the future – that’s why they want the traffic.

Some pics of the carnage

Pretty much everything was gone. Apart from the below fella’s book. Give it up!  People won’t even buy your work when it’s heavily discounted.

Poor Cliff.

That’s not the end of Woolworths for those in the southern hemisphere however.  The brand lives on as a supermarket – I do remember Woolworths being a cheap department/variety store in New Zealand when I was very young, but it transitioned to a supermarket there many years ago.

I won’t miss Woolworths. I only ever bought 1 pair of gardening gloves and a can of “V” from it.

In newbury Waitrose has a poor selection of sushi. In Canary Wharf there is an itsu. I like sushi.

LinkedIn have released an iPhone app. I’m a big fan and user of their app, and I think keeping up to date has just become a lot easier with this iPhone app.

http://blog.linkedin.com/2008/09/16/post-2-2/

(and if you’re interested – http://www.linkedin.com/in/hamishrickerby)

Companies here seem to resign themselves to positions in the marketplace that may or may not be all they can acheive. Seems to me to be wrong that a company has an attitude that being inferior is OK.

My response: If you say I can demand it during take-off and landing, why did I have to fly for around 26 hours with you people and have no on-demand service, after the flight was delayed for around 13 hours?

I guess that’s what you get when your national operator turns into a what is effectively a budget airline. Never flying Air New Zealand again.

Companies refer to humans as assets for 2 reasons. (1) To make employees feel good and (2) because of the value they create for and contribute to the business.

I believe humans are assets to companies, but they are not assets of the companies. The actual asset belongs to the individual – their time – and they trade it for money. The company gets the output of that trade, but the value of the asset remains in the power of the individual.

They won’t appear on a balance sheet, but the work they do with their time that they have swapped for money is the “asset” in the eyes of the business. That appears on the books in the form of IP, physical goods, inventions, patents, or money received for the company on-selling that time (like the work I do).

Oh well, no spending at that particular store tonight.

It’s interesting – I see exactly the same thing in organisations I’ve worked for and with (I mainly deal with very large multi-national companies).  One organisation in particular has a long history of process, and gates, and hoops, and requirements, and documentation, and review periods, and signoffs.  Those things aren’t necessarily bad, but this organisation also has a long history of burning money, and not delivering anything.

Organisations often try to become more agile, deliver more, and promote efficiency through introduction of more management, more process, more rigor.  The core of the process remains the same.  The fundamental problem doesn’t go away.  And these extra layers add overhead; time in meetings, time writing status reports, time appeasing everyone, and building consensus – which will dilute of solutions, rather than making concrete decisions and promoting original vision.

Part of my job now is to help these companies break out of this mold, advise them on how things can be done better, show them a better way.  I do expect that certain companies I work with can’t be altered, and that people won’t understand advantages to the different options out there – perhaps it’s time to change that perspective of mine – give it a shot.  The worse that can happen is that they do what they’ve always done…