Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Yahoo: Time to Reframe the Debate

By

Everybody thinks companies should focus on search. Everybody's wrong.

PrintPRINT
Search is a good business for Yahoo. Search is a great business, period - in the same way that the Yellow Pages were the saving grace of RBOCs like US West/Qwest. In 2003, Qwest (Q) sold its DEX business for almost double the market cap of the company itself!

Forbes reported that it sold for $7.05 billion. (Yes, billion with a b - a word that's certainly become devalued in recent months.) Their market cap at the time was $3.76 billion.

Google is the yellow pages of today. Maybe that's an oversimplification, but it's pretty much that.

Fundamentally, will Yahoo ever be Google-esque? No! But that's okay. Will Google ever be a competitor to Yahoo in content and display? Maybe. Google is aggressively pushing into display, and has also recently cut a deal with content creator Seth McFarlane, so they're certainly dipping their toe into that bucket.

Yahoo has proven year over year that they're the next generation digital network -- Tech Ticker, on finance, is a great example of where they're going. They're providers of the best content - not all produced by them, and not driven by search or paid placement advertising. Stick to your knitting.

Yahoo being acquired by Microsoft is not a 1-plus-1-equals-3 proposition. It will be a 1-plus-1-equals-1-and-a-half – if that. Advertisers spending $5 million on Yahoo and $5 million on MSN (of which there are many) won't spend $12 million on a combined entity - they'll demand efficiency. They'll demand the same media for $7.5 million. This marriage will be about as good as Daimler Chrysler!

Yahoo is different from Google. Yahoo must reframe the debate about who they are and where they're focussed. TV viewing is waning. Dollars are going to continue to move online. Display advertising online may soften, but this is short term.

Yahoo is the network of the future, and should seize these management changes as an opportunity to cement their destiny. Sure, search is a great revenue driver - but it's only one part of the mix. Content and experience is king, and Yahoo is one of the leaders in defining what the new content delivery channel is and should be. You can't argue with close to 400,000,000 eyeballs a month!

It's time to reframe the debate.
Position in YHOO
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
PrintPRINT
 
Featured Videos

WHAT'S POPULAR IN THE VILLE