August 08, 2009

Yahoo! R.I.P.?

Greetings. I've never been one to promote premature burials. But occasionally a single quote by a highly-placed corporate executive crystallizes (often in hindsight, sometimes prophetically) the factors behind the ultimate failure of a firm.

In the early days of the ARPANET/Internet and the Unix OS, the minicomputers manufactured by Digital Equipment Corporation (DEC) ruled the roost. DEC's legendary central R&D facility ("The Mill") in Maynard, Massachusetts was a wonder to behold. DEC sported facilities that even Google doesn't (yet) match -- like their own helicopter service and a private digital gate at (Logan) airport. It seemed inconceivable that DEC could vanish.

But in 1977, when DEC founder Ken Olsen -- a frequent "debunker" of personal computers -- told a convention audience that, "There is no reason for any individual to have a computer in his home!" the fate of DEC was effectively sealed, and its slide into oblivion was already well underway. Fundamentally, Olsen just "didn't get it."

Fast forward three decades. When recently explaining a new deal that effectively ends Yahoo's own search engine activities in favor of Microsoft's Bing, Yahoo CEO Carol Bartz told the New York Times that "We [Yahoo] have never been a search company."

While Ken Olsen's quote showed a profound lack of foresight, Bartz's comment seems to be something else -- a painful case of denial. But it seems likely that her statement nonetheless presages Yahoo's own road to ultimate absorption, obscurity, and extinction -- except perhaps as a disembodied brand name operating in lockstep under orders from masters in Redmond.

Yahoo played a major role in the rise of the Internet as we know it today, and it is with considerable sadness that I predict these events. Perhaps I'm wrong. Perhaps Yahoo will find a way to continue and thrive in the long run. If so, more power to them -- competition is a good thing.

However, when I saw Bartz's quote, a "ghost of DEC" feeling of "deja vu all over again" was unmistakable. When I shop at the (beautifully sci-fi themed) Fry's in Burbank, a Yahoo!-branded office building stands prominently nearby. I wonder how long that logo will remain so ensconced.

I don't recommend replacing the white cemetery plot map pins with black ones while the associated bodies are still warm. But it's difficult to see how Yahoo can pull itself out of the maelstrom in which it now finds itself.

I do wish Yahoo the best of luck. But I fear that in the march of Internet time, Yahoo's clock is rapidly winding down. Time and tide wait for no man -- nor will they wait for Yahoo.


Posted by Lauren at August 8, 2009 01:57 PM | Permalink
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