Jerry Yang the CEO of Yahoo has just articulated for investors the company’s three pronged approach for success. 1. “Become the Internet starting point for the most consumers.” At Zude we call this the “start page” strategy. The start page is your default browser setting – the page that appears when you first log on. 2. “Become a ‘must buy’ for the most advertisers.” That translates into being the marketshare leader in advertisers. 3. “Become an open technology platform for developers.” (No superlatives in this statement; just a policy change.
These are all wonderful, smart business goals; goals with ballast as far as the investment community is concerned. My fear is they are not in alignment. One can certainly gain advertising marketshare by being the leading “start page” provider. Those two work together one can argue. But start pages are not the cash cows that heavily trafficked social nets purport to be — places where users spend scores of hours a month. And then the notion of opening up the APIs to developers – well that has been done by Facebook and, soon, by MySpace. It may work to help Yahoo provide more robust and sticky start pages, but I still wonder about its ability to gain time share (just made that up) of user’s online activity.
Much of Mr. Yang’s analyst presentation, I believe, was intended to communicate focus. I’m not so sure he delivered.