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Tim O'Reilly

Tim O'Reilly

Yahoo's Revival Meeting

Kara Swisher has a very nice account of Yahoo's "Revival Meeting" for top execs, featuring an inspirational talk from Steve Jobs.

Kara (and Steve) are right: Yahoo! has a lot of amazing assets, but what it's missing is a unique vision. Kara says that Jobs says it's all about execution, but I don't think that's true. What made Apple stand out was Steve's uncompromising vision, which often runs counter to prevailing wisdom, but yields "insanely great" new products.

I contrast that with Yahoo's mission statement, "to connect people to their passions, their communities and the world's knowledge." I was talking with a senior Yahoo! exec a few months ago and he was surprised that I thought this sounded like a pale echo of Google's "access to all the world's information." Now, I don't know when Yahoo! articulated this mission statement, but I'll bet that it's far less a driver of Yahoo!s strategy than Google's mission is for its employees.

Yahoo! is a great company, but I don't think they embrace their greatness, or even know what it is. Steve Jobs knows what matters to him. Larry and Sergey and Eric know what matters to them. I don't get the same feeling of innate conviction that I get from Apple and Google, where the company is a reflection of who its leaders are, what they value, and how they think.

Now, I'm not saying that's it's an easy task to build a huge company that stays true to the vision of its founders. There are very few companies that can really pull that off. Yahoo! obviously started that way, with David and Jerry, but early on, Yahoo! turned itself over to professional managers who built the huge company that exists today -- no mean feat -- but who were doubtless motivated by financial concerns more than vision, except as an after-the-fact management exercise. Now that Jerry is back at the helm, he needs to dig deep into himself, and articulate what he really believes in.

Then, the challenge is to get the rest of his company to believe in it as well.

That's a particularly hard challenge when the company's chief sources of revenue are not necessarily aligned with its creative vision. Google and Apple are in that fortunate spot where their business (the sources of their revenue) and their vision are aligned. Yahoo! is pulled between an older display ad-model that is fundamentally hostile to their users, and the vision of user empowerment.

I sympathize. I struggle with some of the same issues at O'Reilly. Our vision of "changing the world by spreading the knowledge of innovators" would suggest that all of our content ought to be made as free as possible, yet our business model (e.g. selling books) requires us to restrict access. We are always walking a tightrope between what we give away, and what we restrict. Our goal is always to create more value than we capture, but it's not as easy as when all the factors are aligned.

tags: apple, google, mission, oreilly, web2.0, yahoo  | comments: 12   | Sphere It


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Comments: 12

Andrew Goodman   [10.02.07 03:32 PM]

Tim, you write: "Yahoo! is pulled between an older display ad-model that is fundamentally hostile to their users, and the vision of user empowerment."

Yes, but so is Google.

Google is, to be sure, still making a large percentage of their billions directly from non-intrusive text-based search ads.

But dominating that market is, for Google, an "already solved problem."

Most of what they are currently selling, growing, touting, promoting, etc., is arguably exactly that display-ad stuff (and other kinds of non-search inventory). We can debate whether this is "older" or not - whether new ways of buying and selling media are emerging - but Google, since 2003, has in fact been pulled between these two forms of advertising, too. "User empowerment" happens on Google-owned sites and properties. They have much less to say about that when it comes to their partnerships with publishers in their growing network.

So are the two companies all that different? And are people really so disempowered by display ads? Time will tell. Yahoo has to hope: no, and no.

Andy Wong   [10.02.07 04:00 PM]

Vision, business model and whether they are aligned. Tim had pointed out the essential structure of an organization.

Even if sometimes a company is not so lucky to have vision and business model aligned, it needs executives' experiences, confidence and bravery to keep the vision when having viable business model, rather than keep the vision has a dummy marketing statement.

Yihong Ding   [10.02.07 09:59 PM]


"Yahoo! has a lot of amazing assets, but what it's missing is a unique vision."

Yes, I cannot agree more with it. Yahoo's strategy is boring, lack of creativity and originality. I wish the newly upgraded Yahoo! Search could inject some activity to this company and eventually it could find a new way to its future.

For your company, I must say that your publications are cool. I like the books you have selected. They really helped me, and certainly many others a lot.

-- Yihong

rick   [10.03.07 12:23 AM]

Yahoo will do well when it adopts Google's vision of placing primacy on search and treating media as secondary. Currently, they view themselves as a media company, and clearly that's not as valuable a franchise as search. The biggest move they could make now is to make the home page,, a search page, identical to what is now

Don Marti   [10.03.07 07:56 AM]

What about the Shi Tao situation and Yahoo's jurisdiction-shopping policy for mail servers--they put user data on People's Republic of China soil, subjecting it to privacy issues and the users to PRC prisons, where other net companies don't.

Companies that have a human rights problem today probably won't suffer from boycotts, but will have to pay a premium for talent as people want a higher salary to "sell out". Are Yahoo executives sacrificing potential earnings of today to establish that they can play ball with the PRC, whose investment funds will own more of Silicon Valley in the future?

Tim O'Reilly   [10.03.07 08:16 AM]


I agree that Google is increasingly facing the problem of business opportunities that aren't aligned with their vision. But I think they have a vision that drives strategy, a set of filters that help them evaluate which projects fit the vision, and which don't, and a set of core competencies that they continue to sharpen.

I don't think it's at all evenly applied. See my post What Would Google Do? for my sense both of what Google's core competency is, and one example of where they fail to align with that. But the core is there.

I do believe that over the next few years, there really will be a struggle internally for the soul of Google, in which new employees, who haven't internalized the vision, will come up with new products that don't fit. This will get much worse when Google hits the inevitable plateau or downturn in their business. (I know we did some very "Un-O'Reilly" things when we were desperately trying to survive the dotcom bust. (E.g. we started focusing much more on growing by taking share from competitors in areas where we didn't publish, rather than just focusing on things we were excited about.) These moves did help us to survive, but weren't aligned with our long term identity and priorities. I'm hoping we've flushed most of them out.

Again, for one example where I've seen this playing out already, see my entries Real Sharing vs. Fake Sharing, and Book Search Should Work Like Web Search,

Tim O'Reilly   [10.03.07 08:30 AM]


I'm not sure I agree that Yahoo! would benefit from making search primary. One of their problems already is that they are seen as #2 in search, rather than #1 in all the areas where they have beaten Google. Try Yahoo! Answers, for one case where Yahoo! soundly beat Google. Or via acquisition, Flickr vs. Picasa. But one of the biggest areas where Yahoo! is the leader is in communications: Yahoo! Mail is far ahead of Gmail in its user base.

The problem of course is that search, where Google beats Yahoo!, is such a fabulous money maker, vs. some of the areas where Yahoo! beat Google.

Frankly, I think Yahoo! should focus on their community products. As I've been arguing for a while, email is ripe to be re-invented in the same way that search was reinvented by Google. (Remember, when Google started, it was a moribund area that no one thought was very valuable.)

See my entry Social Network Fatigue and the Missing Web 2.0 Address Book for some background. Xobni is doing this for outlook, but no one has really thought through the social network implications of Yahoo!s huge web mail community. After all, hidden in our email history is our true social network.

If I were Yahoo!, I'd take the "connecting people" part of the mission, and make it real and central. I'd try to buy Skype from eBay, perhaps, and integrate it with Yahoo! mail.

But more than just painting by any set of numbers, I'd try to figure out what the heart of Yahoo! is. If it's really connecting people to their passions, Yahoo! should be doing way more than being a media company.

Jim Rait   [10.03.07 01:00 PM]

Isn't your mission to inform, inspire and energise us to want to come on the journey of discovery with you... to do that we buy a ticket (in the form of a book) to be on that journey?

mage ringlerun   [10.04.07 04:58 PM]

very interesting topic tim... you are always insightful and reliable with knowledge... :-)

i can sympathise with you (at least i think i can ... assuming i understand your pain! :) when you say "changing the world by spreading the knowledge of innovators" and you have to walk the tightrope of not putting everything out there for free...

an analogy came to me in the shower this morning...

if the best hearing aid manufacturers started giving the hearing aids for free today... their product _might_ soon be start to be seen as average... medical things are one of those things where the more people pay, the more people associate quality with it! but, but but... what if they charged people who could pay, and yet found a way of making the items free or near free in the 3rd world where the poor might not be able to pay and keep them as separate markets... that could work... they can achieve their goal of "bringing hearning to the people across the world" without having people that can afford to pay loose (perceived) faith in the product - which means, the products get out there... and really being the best products... that is the best thing that can happen...

i'm sure you know where i am going with this... so i'll leave it there :-)

Anonymous   [10.04.07 05:03 PM]

wishing there was a way to follow the comments via rss or email ... ( does it pretty well :-)

Tim O'Reilly   [10.04.07 05:07 PM]

mage --

We actually do give away a lot of our books in developing countries, through programs managed by the Network Startup Resource Center ( at the University of Oregon.

We've also talked with a number of folks about using our SafariU platform to remix some of our books into location and domain-specific collections for third world countries.

mage ringlerun   [10.04.07 06:51 PM]

ah... tim, you are already ahead of the game :-) good on you for leading the world to a better place...

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