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Web Giants Are Stretched. It’s Time for Them to Tighten up.
July 26, 2008 - 5:36 pm PDT - by Paul Glazowski 11 Comments
I think it’s time that the Web giants of the West clean house and toss away what they don’t absolutely need to accomplish goals set by management. Why? Technological focus of the highly productive sort has given way to competitive hubris, and those two terms should remain exclusive from one another often as possible. Each of the Big Four - Google, Yahoo, Microsoft and AOL - has displayed terrible redundancies in their own way, and needlessly so.
One of the most outstanding examples, perhaps, comes by way of Google. Google purchased YouTube some years aback, and its acquisition, while still not especially profitable, has come to dominate the field of Web video much the same way the company’s own search-advertising duopoly has grown.
Still, Google Video survives. To be sure, they each serve different purposes. But why is that, exactly? Why work an ancillary angle? Wouldn’t it have been better to do away with Google Video by now and attend solely to YouTube?Also, Google purchased Jaiku, a one-time strong competitor to Twitter that promoted itself heavily for the mobile crowd to great effect, but lost considerable ground in the last year do to the ways of popularity contest. What was the reasoning behind Google’s purchase? To get on the microblog wagon, of course. Yet, if the intention was good, Jaiku nonetheless gained little for its parent. So wouldn’t it be best to just…move on? Jaiku’s homepage signifies its status well at present. The announcement of Jaiku’s move into the Googleplex is still write large. Still.
Now, how about the smallest of the four, AOL. Seems innocent enough, trying to make things happen for itself. But perhaps it’s trying too many things, no? From the looks of it, AOL has only a few really solid efforts underway: its AIM service, its radio (plus Last.fm) projects, and its blogging network. Those are what make AOL sit unique from other giants, it seems, and which should be developed with vigor.
Everything else appears ancillary. AOL Mail is still strong as far as users go, but in utility, it’s no market leader. Search? Three words: “Enhanced by Google.” Sure, its search and home news page are very much bread and butter to the entire operation, but again, AOL can’t survive forever on aid. It needs to find its own way. It should think less horizontal and more vertical. How best to make its most attractive properties better, in other words.Microsoft is at this time a peculiar fellow. It has a reasonable amount of traffic, but its ambition may be too much of a fantasy. Google is very dominant in search, and while Microsoft would do well to remain in the game in order to pull in some coin to fund its Live services, to seek a real challenge with the king of the judge seems somewhat fantastical at the moment. Microsoft was hard after Yahoo, but for $44+ billion dollars, it might be better able to condition its own properties to serve users better.
And that suite of full-fledged cloud office applications isn’t going to make itself. My last word about Microsoft for now: The company’s expansion of its original deal with Facebook to supply a search box for users something that I think is worth more to Microsoft’s future than doing anything really massive with Yahoo.Speaking of Yahoo, it is one player that is so unfortunately confused about its plans for the future that it hasn’t yet managed to make an outright killing with its top properties. From far and wide, cries over the unrealized potential of Flickr have droned on and on and on again. Yahoo Mail, besides being visually refreshed, has remained largely unchanged. Yahoo Buzz, something which many consider to have a clear advantage over Digg, if only for its potential audience, is not displayed with any prominence on the Yahoo homepage. The user must select “More Yahoo Services” in order to gain access. For something which can make Yahoo seem more current and appear more content-rich from the get-go, it’s strangely second-tier. For goodness sake, Yahoo still features a link for GeoCities at its topmost domain. Poor prioritization for sure.
Here’s the thing. The roles of Internet giants are understandably difficult to manage. The carnal objective of enormous financial growth, mandated by the companies as well as the starseekers of Wall Street, is a massively tough nut to crack in and of itself, quarter after quarter. Brilliance is hard to repeat, after all, and sometimes there is only so much you can eek out of a particular business. The risk of having a decision deemed stupid and ineffectual by users and subsequently investors as well, is just added pressure that can only be conducive to cautiousness, and not meaningful progress.
Of course, being a giant also has its outstanding benefits. It means that you carry with your name a sizable amount of money, either in assets or in cold hard cash. Which you can experiment with very liberally, particularly in the startup market. But having the option to do so doesn’t necessarily mean you take it.
For a long time I’ve watched the Big Four mozy about and stretch themselves unnecessarily. I’ve seen things boom, bust, and languish to various degrees of boring. Sites and services launched afresh or have been purchased, and something or other has subsequently stagnated as a result. Yet all too often have those burdens been kept afloat. Why that is is a mystery. There’s no reason for it. They’re dead weight, and the sooner one is done with them the better. You have lower amount of vital statistics to watch over, giving you more opportunity to zero in on what really matters to their brands.
The fact is that excess fat is on everyone’s plate, and the more able one becomes at mimimizing one’s weaknesses, the more pronounced one’s strengths may grow. Really, sometimes it is that simple.
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11 Comments
Simply, it’s about time that these ‘web giants’ start sharing a piece of the Internet pie, and get used to it. They need to realize (and so do web users) that it’s not all about them, and, perhaps, others may actually know how to do it better.
Every time one of the big Internet companies cans a service it affects at least thousands (often millions) of users. It hurts their reputations and it undermines the trust their users have in them. It’s easy for someone who primarily uses Google for search and email to deride the other email and search providers for providing redundant and inferior products, but millions actually PREFER to use those non-Google services. They won’t be impressed by the company that leaves them out in the cold. Google, Yahoo!, Microsoft, and AOL are all big companies with a lot of money and a lot of employees — it’s OK for them to have a lot of fingers in a lot of pies. They don’t need to look for niches to fill like a startup does because they already have huge audiences.
If you’re arguing that the giants need to be concerned about their bottom line, then I don’t disagree — if a service isn’t turning a profit, it may be necessary to can it for the sake of the business despite the fact that the users won’t be happy. With that in mind, I find it really interesting that you mentioned GeoCities specifically because Yahoo! uses GeoCities to market their paid hosting services; you cannot signup for GeoCities without being made aware of the alternative, paid hosting options Yahoo! offers. Is Yahoo! Buzz really the more profitable service at this point? I’m not sure of that at all. There’s also no reason why Jaiku cannot be profitable insomuch as it is possible for a microblogging service to be profitable; why should Google destroy what potentially could be a great service? Obviously, Google hasn’t developed the service like it should have been developed to this point, but that doesn’t mean it can’t do that in the future.
It’s not so much about the bottom line as it is a lack of focus. Each company follows another in its own way, but they’ve gotten so genericized that you can choose any one and they’re pretty much all alike.
The exception is Google, because it’s corporate framework and strategy is different than the rest. It’s relied very much on the 20% doctrine, which has helped the company retain a fresher image than its competitors. But I maintain that Google Video is one item among several in Google’s repertoire that need not operate any further.
As for Jaiku’s potential, the idea of “what have you done for me lately?” is worth repeating.
One thing more - Their actual worth. These companies have now gone well above and beyond their base worth. Brick & Mortar comapnies have physical assets to back their share value. The only thing internet companies have are intellectual assets and visitors. Its all in the mind, and on Wall Street. If they make a mistake, like Yahoo as done, then they, and shareholders, end up with squat.
My latest frustration has been with the lack of (what I consider) serious support for OpenID.
So far, my best experience has been with using Yahoo! OpenIDs with websites. Compared to AOL’s version, the OpenID I can create from my Yahoo! account is much easier for me to remember and use.
There are some websites that don’t use version 2.0 of Yahoo!’s OpenID…so I don’t use those websites.
After creating a couple of Identi.ca accounts (using my OpenID) I have begun to feel Google should consider migrating Jaiku’s current users to Identi.ca. (I hope Twitter and Pownce will allow me to integrate my OpenIDs into my current accounts, as well.)
In the past I appreciated Microsoft’s Live ID, and still do, but it doesn’t appear to be usable with as many different websites and services as OpenID is…
Paul,
Do you really think Google bought Jaiku for the community?
I believe Google acquired Jaiku to leverage its talented team of former Nokia mobile developers for one reason: Android. Great move by Google, for sure.
It may well be true that Google bought Jaiku for the smarts of its developers rather than the product/service itself. But that doesn’t mean keeping Jaiku active in this sort of sluggish state is beneficial to its brand.
One thing I failed to mention in the original post was AOL’s shutdown of several services, including XDrive and Bluestring. Those moves definitely show signs of an internal recognition that focus needs to be at the center of its circle of properties.
Great article. AOL seems to be focusing on places it can win while shutting down areas that are not working. As you point out, it creates problems with internal and external stake holders. Btw, AOL is growing page views again with this renewed focus. Let’s hope the media doesn’t try to kill it.
Yes, still a lot of room to improve, too.
My grand father used to say “To become rich, you need to think of money as milk and income opportunities as the cow, if you only drink milk from one cow, what are you going to do if your cow dies? The only way to become wealthy is by building multiple stream of income, in other words, get more cows to have unlimited supply of milk”
This is exactly what this big corporation do, the problem is that they forget to customized for their customers and deliver a top product with quality support before moving to the next cow…