Yahoo's Big Win

Next Story

CrunchGear this Week

We could tell that there was some real excitement over at Yahoo HQ yesterday – four separate Yahoo PR folks emailed to make sure we knew that Google had announced the closing of their Answers product.

While the announcement was the final nail in the Google Answers coffin, in reality, the “Answers” war has been over for months now.

Google Answers launched in 2002, at a time when the desire for cheap user generated content wasn’t valued much because the advertising market was in a slump – monetizing page views was much harder than it is today. They adopted a for-pay model, where experts received a fee for answering questions, and Google took a 25% cut. By Google’s own admission, just 800 people participated in Google Answers over the last 4+ years (note: see the first few comments here regarding the 800 users number – it’s unclear exactly what Google is referring to).

In contrast, Yahoo Answers launched less than a year ago and with a much different model. Asking a question is free, and user responses are rated by the community and ranked. Users clearly like the model. By August 2006, people had written over 30 million answers to questions, and it had become one of Yahoo’s bigger properties. Yesterday, Yahoo said that Yahoo Answers had over 60 million unique worldwide monthly visitors, who have written 160 million answers to questions.

This wasn’t a war, it was a massacre, and a case study in why all this “Web 2.0 stuff” actually has legs when applied properly. Google went for a direct revenue stream, a business model that made sense in 2002. Yahoo, launching much later, launched a free product and used the ideals of community participation to remove friction from the process and get out of the way of users. This incentivized use and has created a massive number of page views that Yahoo is now monetizing. The network effect kicked in big time.

This was a much needed win and morale boost for Yahoo, which is in the midst of executive turmoil and is struggling to remain an independent entity. Their excitement, which I’ve witnessed only indirectly over the last 24 hours, is palpable. The challenge now is whether Yahoo CEO Terry Semel, who seems to have one foot out the door, or some other Yahoo executive, can leverage this win to help turn Yahoo’s business around more generally.

And it is also a great development for Google, which has now signaled a willingness to kill off failed product experiments and deploy resources in a more efficient manner. It seems that the mantra of “features, not products” discussed by CEO Eric Schmidt and Sergey Brin in their most recent public earnings call is being put into practice. This willingness to admit that a project has failed, and kill it off, will allow Google to experiment on a grander scale in the future.

Late yesterday, Yahoo!’s Tomi Poutanen posted an “open invitation” for Google Answers researchers to join Yahoo! Answers.

  • Todd Tweedy

    Great interview Steve! The conversation thread around real-time, search engine rankings, and Tweets was interesting especially when you move from static to dynamic environments. I can’t wait to see how a real-time search service works!

    • live search

      Live search was the one by Ozzie, just branding as generic term “live” cost them a lot in search, to be precise – cost them 3 years till bing.

  • Matt Terenzio

    Nice job.

    An interesting side note. As I read the article, the cube ad in the upper right id for Tom Foley, who is running for Senate in Connecticut in 2010.

    I guess it’s either behavioral targeting or geo-targeting by IP address. TechCrunch uses OpenX which has geo-targeting so that’s my guess.

    • Matt Terenzio

      Actually I clicked through and it looked like I saw a quick flash of doubleclick, so I guess it could be either.

      • Dr. Bob Obvious

        There was a nice bright ad for an IT WHITEPAPER from some company, whose name I’ve already forgotten, on my browser in the same spot.

        Totally uncanny as earlier this morning I was thinking to myself how I don’t see many IT WHITEPAPER ads on the Internet…or, perhaps I just am not caring enough to seek them out.

      • Your Mom

        You should change your name to Rob Noxious, because that was the most boring comment ever.

  • Finance Geek » The power of clarity

    […] quote below is from an interview Ray Ozzie did with Steve Gilmour, (full text on techcrunchit).  It is a comment on Google Wave: I just know from the Groove experience most recently, from […]

  • Charbax

    Yup, if even Scoble doesn’t “get it”, then sure it’s going to be “hard” for Google to destroy Twitter, Facebook and Friendfeed with it.

    • gabs

      I did not get what you said here ..? Please explain

    • Steve

      GW will totally destroy Twitter, FB and FF.

      Just because Scoble doesn’t “get it” means nothing regarding GW’s potential.

      • George

        Kinda bold given it’s not even generally available. Already a fanboy? Perhaps it would be best to wait until an intelligent conversation is possible.

  • Used Bucket Trucks

    Great Blog. Interesting information. Thanks for sharing.

    • // gabs

      This is for sure an interesting blog

      • Jonny

        It is so cool for blogger.

    • Dr. Bob Obvious

      I like fish.

  • ronald

    I don’t know Groove but Notes always had the feeling, to me, of a complex system based on complex assumptions, same as Microsoft systems. While the old Unix and Apple systems always felt like complexity was boiled down to clear simple understanding and then a complex system was build upon that understanding.

    We’ll see if Google has the People who can boil things down and then build something complex. If they can’t explain what Wave is, things don’t look good. On the other hand their search proofed that they hit it a least once.

    • George

      It usually only happens once. Most companies have a very hard time expanding into new concepts in a meaningful way.

  • fb1436935020

    Very nice interview.

  • Ozzie FUSEs social media teams in Microsoft reorg

    […] subtle re-org may shed light on what Microsoft might do internally to shore up its presence in the RealTime Wave. Chief Software Architect Ray Ozzie has announced the formation of Future Social Experiences (FUSE) […]

  • km4

    Wow Ray Ozzie comes across as somewhat jealous and defensive and remiss that Groove did not amount to much.

    • Derek Scruggs

      I didn’t think he was defensive. He was just acknowledging that it failed and why, and he complimented Google in general. Everything I’ve read about Wave suggests it’s making the same mistake. It smells like a project for architecture astronauts.

      • George

        Derek is right, Ray doesn’t come across defensive.

  • Ozzie FUSEs Social Media Teams In Microsoft Reorg | Tech stuff center

    […] subtle re-org may shed light on what Microsoft might do internally to shore up its presence in the RealTime Wave. Chief Software Architect Ray Ozzie has announced the formation of Future Social Experiences (FUSE) […]

  • Marce

    Interesting comparisons of twitter/other ‘real time’ to financial markets… the systems I architect (in a bank) deal with persistence and real time redistribution of millions of messages a second in approx. 40microseconds. This is normally used for distribution of market data for trading.

    We’re looking at using this technology for other internal purposes such as collaboration where the pub/sub/persistance model can add benefit.

  • Usability and people skills are the key to catching the Wave « Spackle

    […] change or a large shift in user habits, there is a long road ahead for it.  Ray Ozzie has some great insight into this conundrum.  He should know a thing or two about collaboration as the founding father of Lotus Notes and […]

  • Jonathan Frederickson

    IMO, Microsoft should actually go and adopt Wave themselves once it’s open sourced. Not that they will, but… yeah.

  • Feller

    It’s not always bad when elephants are fighting. Sometimes it’s good for the ants having more food on elephants playground. So Maybe ordinary people will get any benefit from this G – MS thing.

  • Flow » Blog Archive » Daily Digest for October 9th - The zeitgeist daily

    […] Shared Ozzie on the realtime wave. […]

  • Technology and Organizations » Blog Archive » The Role of Enthusiast Organizations in Innovation

    […] such collaboration isn’t natural or easy. In Steve Gillmor’s recent interview with Ray Ozzie (Microsoft’s Chief Software Architect and creator of Lotus Notes and Groove), Ozzie says […]

  • links for 2009-10-10 | Glorified Monkey

    […] Ozzie on the realtime wave Interview with Ray Ozzie (tags: realtime microsoft messaging twitter wave google innovation rayozzie) […]

  • Announcing The Realtime Board And Our Next CrunchUp on November 20

    […] are not the only ones who think this is a big deal. Back in July, TechCrunchIT editor Steve Gillmor and I organized a Realtime Stream CrunchUp. It was […]

  • Mash123 » Announcing The Realtime Board And Our Next CrunchUp on November 20

    […] communicate and interact with one another. &#32&#10&#87e are not the only ones who think this is a big de&#97&#108&#46 Back in July, TechCrunchIT editor Steve Gillmor &#97&#110&#100 I organized a Realtime Stream […]

  • Weekend Reading

    […] Ray Ozzie on the Real-time Wave: from TechCrunchIT. An interview by Steve Gillmor. […]

  • Matt McAlister » Positioning real-time web platforms

    […] Chief Software Architect Ray Ozzie played down the depth of Microsoft’s commitment to it in his recent interview with Steve Gillmor, it’s apparent that it’s at the very least a top-of-mind subject for the people at the […]

  • John

    It’s very interesting how “big guys” are always showing them self like common people saviors.

  • trips&tricks

    i dream to go microsoft campus, i will go, thanks it was to read…

  • The present and future of real time | Digitizd

    […] the whole TechCrunchIT interview. Save and […]

  • bieliźnie

    Thanks a milion for your personal challenge and additionally results! These things upon your internet site is normally terrific. Additionally Document really recognize any tips. In my opinion however these are significant factors. Anyways bless you. Excellent look over.

blog comments powered by Disqus