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There has been a lot of press about the problems at Yahoo! and their 100 day quest to reinvigorate the company. With all this bad press, one has to remember that Yahoo! has:

• Huge consumer audience - check
• Large advertising base/reach - check
• Number of branded websites - check
• Recognizable Brand Name - check

In short, Yahoo! has all the assets stacked in their favor to succeed. In the end it really boils down to:

Execution, Execution, Execution!

That’s about it. The only “sacred cow” that needs to be sacrificed by Yahoo! is the slow moving, stagnant, execution killing company culture.

Yahoo! reminds me of the classic movie Rocky 3 where Rocky Balboa has become complacent surrounded by yes men. Rocky’s trainer, Mickey, dies and can no longer protect Rocky. The fierce Clubber Lang (Google, Mr. T in the Movie) beats the living crap out of Rocky. Rocky, through the help of Apollo Creed (played by Steve Jobs), regains his confidence and the “Eye of the Tiger” to learn to fight on his own two feet.

Reinventing (or rediscovering) the company’s killer instinct (Eye of the Tiger) begins and ends with the people @ Yahoo! The way to get it back is to go back to the beginning and remember who Yahoo! really is, focus on the consumer, and (re)learn how to WIN.

Filed by SWong at 3:13 am under Yahoo!
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Yahoo! just announced tonight that they acquired Blue Lithium for $300M in an all cash deal. This is an excellent move by Yahoo! to pick up one of the leading companies in the performance marketing space. Blue Lithium boasts a data driven targeting platform that is one of the best in the industry. In light of the recent multi-billion dollar acquisitions of Doubleclick ($3.1B - $300M revenue) by Google and aQuantive ($6B - $442M revenue) by Microsoft, this appears to be a excellent deal for Yahoo!

Update: It is estimated by Mashable.com that Blue Lithium’s revenue for 2006 was $100M+, further evidence that this was a good deal for Yahoo!

Coverage from around the Web:

• Mashable: AD FRENZY: Yahoo Acquires BlueLithium for $300 Million Cash - Estimated Revenues of $100M+ in 2006
• TechCrunch: Yahoo! Acquires Ad Network BlueLithium
• VentureBeat: Yahoo to acquire advertising company, BlueLithium, for $300M - Lists Blue Lithium as #5 in reach with 66%

Filed by SWong at 3:25 am under Interactive Advertising
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I just watched an interview by Kara Swisher, Boomtown, of Jason Calacanis of Mahalo on the All Things D website.

For the life of me I still don’t see how Mahalo will scale. Yahoo!’s original directory started off with a team of Surfers (editors) who created and organized and ontology. Yahoo! ended up decommissioning the directory because it didn’t scale. Yahoo! was overwhelmed by the number of submissions.

Fast forward to what eventually became Open Directory Project (aka DMOZ) which eventually amassed over 70,000 editors. The current DMOZ is rife with SPAM, dead links, neglect, and accusations of graft.

Other things such as Social Bookmarking (i.e. Del.icio.us, Reddit, etc) have shown problems as well due to the lack of depth.

Mahalo, to me, is more like Answers.com than a competitor to Google, Yahoo!, & Microsoft’s search engines.

The bottom line is the Internet, growing at an exponential rate, just can’t scale with linear approaches to organize the information. One must employ algorithmic techniques that can scale with the growth of information on the web and understand concepts from a fundamental relationship level.

More on this later…

Filed by SWong at 8:40 pm under Uncategorized
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A recent research report from Microsoft (NY Times article) claimed that approximately 11% of search results and as much as 30% of some competitive search results contain Internet Content SPAM. Spammers create these pages for the sole purpose of profiting from advertisements by fooling the search engines (i.e. Google, Yahoo!,etc.) to rank their pages well. Typically these SPAM sites are computer generated to create huge numbers of pages each targeted to rank well with a specific keyword.

There are many strategies, but typically these SPAM sites are computer generated to produce a huge numbers of pages, each targeted to rank well with a specific keyword. I’ve found several SPAM content generator scripts (YACG, RSSGM, WP AutoBlog, & MyGen) on the web that take content snippets from a variety of articles cribbed from across the web. These scripts auto generate content by jumbling content snippets into search engine readable pages using statistical algorithms such as Markov Chains. Add a custom template to make the site unique and create an internal link network between pages within the site.

Once the site is built, Spammers create huge numbers of bogus blogs (Blogger) and webpages (from free hosting sites such as Yahoo!’s GeoCities) to build links directed towards the Spam site. This confirmed by the Microsoft study where most free web hosting and free blog sites have over 70% Internet Content SPAM.

Internet Content SPAM is a huge problem for Search Engines because it degrades the quality their search results. As Albert Einstein famously said “We can’t solve problems by using the same kind of thinking we used when we created them.”, it is tough for Search Engines to identify Internet Content SPAM. Typical approaches entail usage of filters and/or blacklists when a SPAM signature or domain is discovered. This makes Internet Content SPAM one of the most vexing issues for this generation of Search Engines.

Filed by SWong at 6:25 am under Interactive Advertising, SEM, SEO, Search
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Just came across this very interesting article on “Crowdsourcing: A Million Heads are Better Than One.” The article talks about examples of harnessing human behaviors and interactions into three distinct areas:

1. Creation (Ex. Open Source Software, Wikipedia)
2. Prediction (Ex. Pickspal.com, Stockpickr, American Idol)
3. Organization (Ex. Google’s PageRank, Digg.com, DMOZ)

The concept of crowdsourcing is really interesting in that it is really self-organization where seemingly chaotic conditions goes through a phase transition to bring about some sort of order. You can find self-organization everywhere from diverse subjects such as nature (Ex. Ants), business (Ex. market bubbles), physics (Ex. equilibrium thermodynamics), chemistry (Ex. chemical reactions), Entertainment (Ex. American Idol, Billboard Music Charts), and of course the Web.

Value is created when one can harness the power to create structure from unstructured chaos. In Physics, this phenomena can be described in mathematics.  This is very much the problem that our team at Search Physics have been trying to tackle when it comes to organizing the information on the Web. Stay tuned for more.

Filed by SWong at 2:29 am under Marketing, Search Physics, Web 2.0
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Brilliant! I am very impressed by the recent release of several Digg style user feedback and voting mechanisms applied to improving companies and products. There are two forward thinking companies who have gained quite a bit of press:

1. Dell Ideastorm - No doubt part of the effort to revive the fortunes of Dell now that Michael Dell is back at the helm. Makes Dell more open and responsive to consumers. Much better than a canned survey from a market research firm since the suggestions are unedited and can be voted upon. I absolutely love the fact that it requires registration so Dell can continue a dialog with these consumers who obviously care.
2. Yahoo! Suggestions - The Yahoo! Suggestions board is being used to gather feedback for quite a few number Yahoo! properties (15 at launch) from Autos to Real Estate. A pretty good first start. The only wish I have is Yahoo! should really promote this a lot more. A lot of the suggestion boards don’t have a lot of traffic nor enough feedback to form a critical mass.
I know that there are a lot of folks in the blogosphere who decry these efforts as blatant rip-offs of Digg, but I think all of these folks miss the point. As a marketer, the hardest thing to do is to create a vibrant and constructive dialog with the consumer. These “Digg-like” Web 2.0 features merely make customer feedback much more accessible, cost effective, and with the added benefit of sifting out issues that are more important than other due to open voting. Remember, Digg didn’t invent voting nor did it invent ranking. Digg’s great breakthrough was they packaged it in such a way which was brilliantly easy. Besides, Drupal had this feature in their content management system since 2000.It would be great if brand marketers and product managers across different industries embrace harnessing the consumer voice to improve products and customer experience. Imagine if car enthusiasts had this capability to suggest new features and product wishes for their favorite vehicles (Detroit anyone?). Or how about struggling airlines use this capability to markedly improve flight service and give us options for better food on flights. It would be very easy for old line companies to begin offering these capabilities by leveraging open source solutions like Pligg (an open source version of Digg).

Remember, companies exists to fulfill and capitalize on a market demand or consumer desire, what better way than to get this feedback directly from your customer’s mouth?

Update: Peter Cashmore and TechCrunch has a pretty interesting post about this as well.

Filed by SWong at 10:14 pm under Marketing, Web 2.0, Yahoo!
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Last month, I found out the patent for the Yahoo! Buzz Index (US Patent 7,146,416) was granted. I had a great time working with Janice Yoo, Elliot Yasnovsky, and KT Lim on building this project. From Search Engine Land:

Filed by SWong at 7:51 pm under Marketing, Search, Yahoo!
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My friends, Ali & Hadi Partovi, has launch a new service in beta called iLike. iLike is a cool new music discovery service that hooks into your playlist on iTunes. Add a bit a social community and shake it up with Web 2.0 goodness and you have iLike.

iLike is a startup everyone should keep an eye on since the brothers Partovi are instrumental in bring to life LinkExhange (one of the first ad networks acquired by Microsoft), TellMe (Voice Recognition), and Microsoft Internet Explorer (Hadi led the way).
Scoble Show on PodTech just released a great interview with Ali giving an interview about iLike. Try it out!

Filed by SWong at 1:54 am under Startups
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I just read Rick Skrenta’s great blog post,
“Winner-Take-All: Google and the Third Age of Computing”

Rick is right on the money with a lot of his observations, especially the fact that Google has built their huge lead on the backs of the Search and Advertising dominance.

One thing I’d like to add is zero switching costs also has a downside for Google if a new entrant is **significantly better** than the incumbent. So far, the efforts of Yahoo!, Ask, and Microsoft in the search space are building on essentially the same technology platform as Google. The best they can do is incrementally better than Google and therefore have a huge challenge to overcome the brand gap and technology refinement from Google’s band of top notched engineers.

Significantly better requires one to make a dramatic leap (technology or business model) beyond what Google is doing today. When Google came into the market they introduced PageRank (link based algorithm) which was significantly better than the prevailing keyword based ranking technologies employed by the incumbents (AltaVista, Excite, Infoseek, Inktomi, etc). PageRank introduced, for that time, a relatively SPAM free search environment that plagued the keyword based search engines. So for users comparing searches performed on Google vs. the incumbents the results were startling.
The biggest challenge for search continues to be search SPAM. SEO practitioners (white hat and black hat) have continued to arm themselves with tools to SPAM the current generation of search engines. These tools include keyword based semantic page generators (using Markov chain models) while linking them together into artificially generated networks to improve ranking.

Having worked in the Internet space for over 10 years, I personally think that Google is not invincible. I’ve seen too many dominant players come and go during my career to be bold enough to make that claim. However for the potential competitors, it requires one to have a talented team that can approach this space from a completely different vantage point and offer up a new technology paradigm to advance the state of the art towards the next generation. This requires a healthy combination of Smarts (Innovation) + Money (to Scale the business) + Flawless Execution to achieve.

Filed by SWong at 8:55 pm under Search
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Wow… The day after the Yahoo! earnings release the stock gets hammered by 20%. That is a huge chunk of market capitalization being lost due to a delay in the launch of the Panama project by an additional 3 months. Seems like the street is losing confidence in Yahoo! to execute.

Filed by SWong at 8:58 pm under Yahoo!
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