Home > Business, Tech History, web > Thou shall not repeat the same mistakes…

Thou shall not repeat the same mistakes…

Today, as I was thinking (again) about the Yahoo-Bing deal, I stumbled upon one of the hundreds of posts about mistakes of tech companies:

http://www.pcworld.com/article/170337/the_10_stupidest_tech_company_blunders.html

I really don’t like the writing style of that kind of top-X-list stories and I am sure that anyone that has been around for some years and is interested in tech history could think of numerous other stories. Unfortunately, for some unexplainable reason, I cannot stop reading those articles as I find them especially amusing:

  • IBM did not bother to write an OS for PCs and outsourced the job to Microsoft…
  • Yahoo did not buy facebook for 1B$..
  • Real Networks turned down the offer to create the ipod..

Really funny… But my interest is not focused on the past, but on the decisions made by tech companies today. I cannot understand why Yahoo gave away one of its most valuable assets: search. We are not talking about a medium company with 1-10 Million hits per month. Yahoo was the second largest search company in the world with 20% market share. And when we are talking about search, the active target group is 1 Billion users. I understand that they will keep the 88% of search advertising revenues on Yahoo-owned sites every year for the next five years, but the problem is that they have lost their focus when they decided to through away their engine and use Bing instead. They try to become a consumer of innovation instead of building their strategy using their own know-how.

What will happen in 5 years when the contract with Microsoft will have finished? Looking back a couple of years, we can see Yahoo repeating the exact same mistake. As Jason Calacanis writes:

… Search is the most important business of the 21st century and owning a commanding lead in second place is not insignificant. At one time Yahoo was the number one search engine and portal. However, they didn’t see the value in search and decided to syndicate that piece of their business to a small company called Google. For a couple of years we all experienced Google in Yahoo’s wrapper. Our only indication of who made this wonderful tool was a tiny “Powered by Google” logo on the top right of the page. … Had Yahoo not given their search franchise over to Google back then, there is a good chance that the race for the most important business of the 21st century would be a dead heat. Certainly it would be closer .

I totally agree with Jason and I believe that it is worth reading his post and the counter-points by Fred Wilson and Bill Gurley.

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