January 17, 2007

Yahoo! Has Fallen and It Can't Get Up

Picking on Yahoo! for its failings is as easy as it once was to pick on Microsoft for its monopoly tactics and shoddy software, or Apple for its scant market share. It's not as if the world needs yet more proof points that Google has won the online search and advertising race, and that Yahoo! has squandered more than one opportunity to get ahead. Yet an increasing amount of news shows that Google is taking more share in all categories at the expense of Yahoo! and Microsoft, despite already having the leader position.

Yesterday, Comscore released its December search rankings for search engines, showing Google with 47.3 percent. Yahoo! eked up to 28.5% and Microsoft fell to 10.5%, down from 11%. Tom Foremski wonders aloud if there is a place for niched, specialized search engines that don't try to do it all. While many are being funded, the truth is that outside of the top two engines, everybody else seems to be losing share, as consumers grow more comfortable and entrenched with Google especially.

The battle over search engine eyes and clicks, and the domination of Google, grows ever more astounding when one learns more about the history of Google and Yahoo!, particularly. Wired Magazine launched an extensive piece on how Yahoo! once had the opportunity to acquire the nascent challenger in the summer of 2002, but simply didn't offer enough dough. As the article points out, this stemmed from the timing of it all. In 2002, as the first Internet bubble had come crashing down, Yahoo! was left a shadow of its once high-flying self, and it just simply couldn't scare up billions to acquire Google. Instead, they settled for second best acquisitions of Inktomi and GoTo (now Overture), and couldn't mash the new products together well enough to take on what's become the far and away market leader.

As much fun as it is to see companies challenge the market front-runners and add more services beyond their core business model, I believe they also need the ability to recognize where they are failing and they need to make the hard decisions to focus on what they do well. I don't use Microsoft search and Yahoo! search because they simply aren't as good, and won't get me the answers I need. Advertisers know the intelligent consumers have made the choice, and that choice is Google.

No comments:

Post a Comment