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I still pretty much remember the days when Yahoo! was a young upstart, dominating the New Brave Web World with the vigor of the youngster and bringing more and more content to their search page. In no time, it’s closest competitor Altavista disappeared into the nostalgic fog of the early Internet days, and Yahoo! was suddenly alone (well, almost alone… MSN was there as well, but not as nearly as strong as Google is today). Instead of capitalizing on their clear advantage in the growing market, Yahoo! decided to stop, and continued to clutter their search page with more and more (unneeded) content until it was so cluttered that one couldn’t have tell the difference between a messed up Internet portal and Yahoo’s main page. Incidentally, more content meant more employees, and Yahoo! started to hire all over the place. It soon became what it is today, a giant corporate monster that matured so fast that nowadays Yahoo! does not differ much from IBM (and the age difference between the two is drastic…). The corporate behemoth then fell asleep, and another youngster jumped in behind his back and took the market right before its nose - Google recognized what people were asking for - a simple and efficient search engine giving fast and precise answers to their questions. Simple as that! Google took over and replaced the ‘old’ Yahoo at the throne (remember, we’re talking about ten years period!).

So what happened!? What went wrong? Where did Yahooans slipped!? The answers are simple and complex at the same time. Yahoo! was growing too fast, and they had no idea what their long term strategy is - of course they had long term goals, but that’s an entirely different matter. Yahoo! didn’t lose the race due to Google being too fast, but due to the fact they were much slower - as soon as investors jumped in with big bucks, and without real understanding of the market, everything started to collapse. If they have had a vision and understanding, they would have crush Google long ago (simply by buying them off) when they were a young rising stars on the Internet sky. But no, they’ve decided to ignore it, and made the biggest mistake in the short history of Internet business. At the moment, Yahoo! is enjoying a renaissance, being the most desired bride out there, but as soon as the voices about the ‘big merge’ are silenced, the shadow will fall, and the Internet giant will fade out to anonymity, facing its inevitable destiny.

I am just wild-guessing here, but I wonder how honest Microsoft’s offer really was in the first place. Knowing that the offer will be eventually turned down, Microsoft intentionally created all this fuss to make more room for their ‘live’ platform. Yes, Yahoo’s stocks did go up, but when the market realizes that this price is a result of unrealistic expectations and that Yahoo is still as tired and old as it was before (and torn apart from within, because they won’t be able to get out of this episode without some scars), their stock could go even below their real value, which opens up a space for capable buyer to get this Internet giant cheaply. Whole story was just an impressive exercise in power for mighty Microsoft, and - in the long-term - only Microsoft will profit from it. They had free media attention for a while and - more importantly - they made Google fears come up on the surface. Google’s desperate attempts to stop something that hasn’t even begin to happen certainly gave Microsoft some clues about their most dangerous competition, while at the same time revealing Google’s Achilles’ tendon to the public. A good insight into opponent’s weaknesses is the greatest advantage one could have when starting to fight.

This whole story brings up the memories of S3 - once undisputed king of 2D graphics on PC computers, and now buried deeply under the realms of powerful graphics produced by nVidia and ATI.

Maybe the saddest part of the story is the fact that Yahoo relies on Google’s technologies (page ranking algorithms) to determine the web site’s importance. So what the heck they’ve been doing in their labs all this time!?
Goodbye Yahoo!, some of us will miss you