In his posting titled Reading the Google Tea Leaves, Tristan compares various product offerings from Google against those of the "big three" (AOL, Microsoft, and Yahoo!) and concludes:
Google does innovate in some spaces but has largely innovated in order to gain entry in markets that already existed. As a rule of thumb, they've been very smart at breathing new innovations in those markets. However, their competitors are generally quick to notice and are catching up.
I've been giving a much shorter verbal version of his post for many months now. Typically when I'm interviewing someone or talking to random folks who are trying to figure out this industry we're in. They'll ask a question like "what do you think Google is doing?" or "where is Google really headed?"
My answer is this: Google is trying to build Yahoo 2.0.
It's really that simple.
If they press me for details on this theory (that only happens about half the time) I say that it's as if someone decided to re-invent more and more of Yahoo's popular services in random order, giving them a fresh user interface, less historical baggage, and usually one feature that really stands out (such as Gmail's storage limit or Google Talk's use of Jabber).
When Google Calendar and Google Finance (more in a future post) finally show their faces, I suspect they'll follow the same pattern. They'll look like someone sat down and thought "I'm starting with a clean slate, so how would I build a modern version of Yahoo! Calendar, with a newer and more interactive UI, one killer feature, and fixing the various things we've learned since Yahoo! Calendar launched many years ago?"
A few people have recently told me that I'm not "stirring the pot" enough on my blog anymore. I assume that by "stirring the pot" they mean "talking trash about Google", so maybe this counts? Or maybe it's not trashy enough?
Anyway, what's your theory? Is Tristan right? Am I right?
Will Microsoft try to build Yahoo 3.0 in 24-36 moths when their newfound "services" vision finally trickles down through the ranks?
Posted by jzawodn at November 10, 2005 02:38 AM
Is this a very convoluted way to say that Google builds same produts that Yahoo has, only better?
And talking about Gmail - it was not about storage limit,
it was about UI and UX (user experience).
I agree entirely, Jeremy -- and have been saying the same thing. Well, building Portal 2.0, perhaps. Gmail was a great example of the starting with a clean slate idea. Blogger as I've written (see http://searchenginewatch.com/sereport/article.php/2165221) was simply a new form up home pages and much cheaper for Google the portal to buy than GeoCities was for Yahoo. Google Groups 2 was another move to match Yahoo Groups, though not quite the dramatic clean slate approach. From what I wrote (http://searchenginewatch.com/searchday/article.php/3353411) about that:
"Now as Google's competitors are fighting to win users in the current search wars, Google Groups 2, like Gmail and Blogger before it, seems a way for Google to strike back at the portal features that some (see Forrester and Moreover) mistakenly assumed it would be weak on or missed buying."
I've long called Google a stealth portal. Perhaps that's another portal 2.0 feature -- not admitting you're a portal.
Google is making the same mistake Yahoo did years ago, building headcount and letting them pursue mediocre ideas when they should be improving search. Only for Google, it is worse because they are launching products (e.g. Talk) into saturated markets.
I agree with you, Jeremy, but what is Yahoo doing to build Yahoo 2.1 instead of Yahoo 1.9? I can't imagine the company is going to be wanting to play catch up forever.
I'm curious to see if Yahoo has any truly innovative and original products in the pipeline or if they're simply waiting to see what Google has next in order to react to it...
Interesting. I see your argument, but what point are you trying to make? The electric toothbrush takes the toothbrush design and adds to it. The Walkman (and now iPod) took the idea of a boom box and made it [more] portable. Some of the greatest products/services come from frustration with an older product.
Necessity is the mother of invention, after all.
You seem to be agreeing that, for instance, Gmail is better than Yahoo! Mail. And you're saying "Of course it's better -- Google took an idea Yahoo! had, started from scratch, and just improved one thing!" And took advantage of the existing market, that Yahoo! put a lot of work, time and money to build.
That's how life works, though. . . so my question is, "yeah, what does that mean?" Does it mean Yahoo! is better than Google because Yahoo! comes up with new ideas? Or is Google better because they are taking advantage of all the information they have available to them? I could argue both ways.
Jeremy I completely agree with you. Except for select services like Search, Adsense and Maps, all else that Google has been doing seems to be building Yahoo 2.0. Although Gmail was a very succesful attempt(its more than space, like Rimantas put it its UI and UX) at making Yahoo Mail 2.0. The rest haven't been so good.
But what's wrong with that. Learning from peers and doing better things than them aint wrong. aint yahoo maps is trying to be Google Maps 2.0.If Yahoo keeps playing the catch up game for a long time I am sure Google will build Yahoo 3.0 and maybe even Yahoo 4.0.
Must tell you Yahoo doesn't seem to be good at this catching up game, yahoo groups doesn't yet have rss feeds, yahoo blogs(blogs.360...) is pathetic. So I guess its time Yahoo gathered its wits together and catch up (oops!), go ahead of the competition, than point fingers at Google and say "they stole our ideas".
Google does seem to be doing lots of research, little of which will probably result in products. For example, they competed in the NIST translation challenge this year and had some of the highest scores. Who knows what products will come out of that, if any. (http://news.com.com/Google+dominates+in+machine+translation+tests/2100-1038_3-5841819.html)
What I'm curious about is why Yahoo! is sitting around waiting for this to happen first before they revamp their existing interfaces? Aren't you guys getting a little tired of Simon Says? How about a little innovation of your own, try one upping the competition before they get the jump on you.
I agree as well. Why are there so many mediocre products that languish for so long without any major end user improvements, like Yahoo! Groups. I am both a user and a subscriber to groups, and it is amazing how little has changed on that property for the 6 years I've been using Groups (when it was eGroups).
Calendar/PIM functionality has not really changed all that much either.
If it weren't for Gmail, would Yahoo! have acquired OddPost? Only when it's business is threatened does Yahoo seem to react.
Yahoo! needs to be more product/services driven than media and sales centric to compete with Google.
Google should just go ahead and change their name to "Google!"
Yahoo has great tools (which I use almost all of, by the way, as a hosting customer and long-time my Yahoo! user...), but Google makes the same thing a little better.
They also seem better at grabbing headlines about their new stuff. As the press fawns over recent announcements of Google "innovations", my most common reaction is "huh, I've been using this feature on Yahoo for x years"...
I posted something about this last month in a reaction to your CEO's comments over the Google-Sun non-announcement... http://bbenz.typepad.com/softwaresoapbox/2005/10/yahoo_ceo_belit_1.html
Also, IMHO, Yahoo is not the ultimate target...
http://bbenz.typepad.com/softwaresoapbox/2005/10/googlesun_compe.html
So if Google is trying to build Yahoo 2.0 which seems a fair analysis (in broad brushstrokes...at this point in time...etc...), where does that leave Yahoo!? How will Yahoo avoid losing out to a competitor that does seem able to reimplement their offerings with a tad more gloss?
Just because Google is pursuing a similar strategy as Yahoo! it doesn't follow that their products are necessarily better. I'm not sure where people get that idea. Some things they do much better, some things they do much worse. "First-mover advantage" is a complete myth in technology; in fact, you can argue that in a competitive market, the second and subsequent movers have the advantage -- assuming they can build sufficient momentum.
There's also no such thing as "the ultimate target" in business, you compete against a marketplace full of competitors, not a single competitor.
Sorry, Jeremy, I think the whole thing is silly. Companies typically exist to meet customer needs and wants and, for example, people want to manage their schedules so -- imagine this -- Google is eventually going to add online calendaring services. Will this be a "Y! metoo... will Google be doing this simply because Y! has it? No.
I know it's trendy and possibly humorous to joke "Ha! Google does something one day, Y! copies it the next!" and vise versa, but as an engineer friend of mine at one of the search engines commented the other day, shaking his head in disbelief... "Do these idiots know how much lead time there is in projects like this? What, like we see a press release or some $&(# on Monday and we build a competing tool on Wednesday? Yeah, right."
In other words, despite popular rhetoric, it seems that these two companies at least are working their collective asses off building and improving tools, some of which end up rocking, others which end up sucking, mostly independent of each other. Simply because the timing may be similar does not indicate copying or me-tooing of any sort.
I think more appropriate will be Google is building Yahoo -1.0. Yahoo is much ahead of Google in Web 2.0 space.
Ok jeremy for once i don't think you'really clear in what you say. What about that post:
http://jeremy.zawodny.com/blog/archives/004762.html
Danny Sullivan beat me to my point, but I'd like to stress
it again and make more explicit.
Could you elaborate on what exactly makes it Yahoo 2.0 vs Any Other Portal 2.0.
"giving them a fresh user interface, less historical baggage, and usually one feature that really stands out" I think indicates that Google's versions are better.
The real question is why companies cannot do their own version 2.0s. Why do they leave the 2.0 version to upstarts? It will be interesting to see if Google re-invents its services getting rid of the useless cruft that accumulates through the years.
This is more than true all of what you are saying. I do believe yahoo is playing catchup also. However, I peronally think EBAY is going to buy Yahoo instead of Microsoft. EBAY would seem to be a better strategic partner...even though they have a solid working relationship now.
I really look at the whole thing another way. Google is replaying Yahoo’s playbook circa 1996. Back then, we simply looked at what people were searching for and then built services that they wanted. Filo called the query logs “our to-do list”.
http://www.scottgatz.com/blog/2005/11/10/google-building-yahoo-20/
I don't really agree with what you have to say about Yahoo catching up to Google. I honestly at this time think it is the other way around.
Yes certainly Google has some amazing features that people are loving. This is just part of the business world. One takes the ideas from others, revamp & reshape it and make it feel like a new home for the customer. Don't you think this is what is happening here? Who came up with Search engine? Yahoo or Google? Well you know the answer.
Who opened the door to buying keywords on a search engine first? Google or someone else? Where did Adsense come from?
So if I put this right, "Google is doing well in pleasing the public by adding creativity to existing innovations".
Cheers,
Guna
I disagree, to a certain degree. Obviously, I think the main difference between the two is that Yahoo still tries to centralize everything, while Google seems to understand, or at least benefit from, the fact that it isn't necessary to centralize everything. People are generally pretty smart, and are pretty good at finding things on their own.
I love Google, and I think Yahoo has been pretty boring as of late, but I think Google is still riding a wave of good will from the release of Gmail. It was a pretty good strategy to have your killer app be the one that people use the most, probably more than Search. It doesn't hurt that they knocked it out of the park, and from what I've seen, the YMail beta seems to indicate that Yahoo still doesn't get it. Gmail almost feels like an Apple product(read: special, thoughtful, luxurious), whereas YMail looks more like a Microsoft product (focus on tech wow factor, more evolutionary improvement on the actual u/x, etc.).
Google seems to pull that off well. I still prefer Gmail to Ymail, Gmaps to Ymaps, Google Personalized homepage to MyYahoo, etc. The only thing cool out of Yahoo in awhile is the Farechase Beta. I still like Google's implementation of fare lookup, but Yahoo Farechase is a really slick app, and there's a lot of thought going into the ui (though it still needs a few tweaks). Yahoo needs to get that team on more projects, and start thinking more about the u/x rather than the technology.
Anyhow, I didn't mean for this to come off as a slant against Yahoo. I'm just continually finding myself impressed by Google. If one thing has started to become clear, in terms of strategy, Google thinks big, really, really, big. Somehow, while doing so, they seemingly never lose sight of the details that matter most to the user. Maybe it's all those PhDs finally paying off. It reminds me of comment awhile ago where someone mentioned that if every political consultant thought 10 or 15 steps out, Karl Rove was thinking about 25-35 steps ahead. Seems to be an ample comparison for Google vs Microsoft/Yahoo.
I will say though, if Yahoo makes just a few more of these major media partnerships, I think they risk losing me. One of Google's major strengths it seems to me, is it's ability to simultaneously stay a pure (mostly) internet company to excite the early adopters, while introducing the mainstream to well designed services.
You are right. It's strange how Google could preserve his image even after paying a few hundred million in damages to Overture shortly before their IPO. They claim to do no evil but act like the Evil Empire themselves.
I am willing to bet money that they eventually change their business model to what SNAP is doing.
At the end it won't help them win against the Evil Empire.
Google has a big funding advantage over Yahoo. They can try a lot things to effectively purchase market share because they have an incredibly profitable ad auction system based on search.
So there is one area where Yahoo NEEDS to copy Google: the ad system. Y!SMS needs to change from a linear auction to the AdWords black box, in order to maximize profitability AND increase relevancy and conversion for the advertiser and searcher.
Both can prosper next to each other. Yahoo can make it a race if/when Overture ever re-launches successfully.
Yes, of course Google is building Yahoo 2.0. They are just doing it better. As they should - they already had a few models to follow.
Further, however, they are also slowly and somewhat clandestinely laying the foundation to serve (and therefore control) more than what the current web supports well, namely streaming video, audio and VOIP. Blogs too, which are nothing more than single thread forums where people opine all day...
My question is "so what"?
Narendra,
If you don't think Google is working hard to improve search you're either A) not paying attention or B) out of your mind.
I'm not so sure about this, Jeremy. I don't think Google is trying to be a better version of Yahoo.
Seems to me the companies are going in different directions. Google emphasizes information and algorithms. Yahoo emphasizes media and community. Google wants people to come to Google because it is the best way to get the information they need. Yahoo wants people to come to Yahoo to use the convenient and useful suite of Yahoo features.
Neither is following the other. The two companies are on nearby paths, exploring, discovering what works and what doesn't. But they are different paths with different endpoints.
Saying that Google is building Yahoo 2.0 is not exactly trash-talking them. If they succeed in doing that, Yahoo is hosed, aren't they?
i don't think google is trying to build yahoo 2, because yahoo 1 is based on a premise google does not have to concern itself with - consuming all known attractors of traffic on the web. yahoo is still ruled by the 90s meme of "eyeballs", and that is because yahoo can only advertize on yahoo. so if fantasy football or pictures of modded cars or whatever takes off on the web, yahoo must build its own site or buy the most popular one, because it must have those eyeballs on yahoo.com since this is the place it shows its ads. this is why yahoo does so many acquisitions.
google does not need consume all attractive content on the web into the google.com domain - it can treat these sites as partners instead of adversaries by advertizing on them via adsense. this frees them up to build platforms where their scale can be used effectively, and it also frees them from having to do acquisitions to "buy traffic".
people can cop-out by calling yahoo a media company (false - what media does yahoo OWN? they are a media LICENSER), but ultimately both google and yahoo are ad distributors, its just that yahoo still employs the meme of "eyeballs" where google is employing the platform of the whole web.
its worth noting that back in the "bust" there was a huge push to doversify revenue at yahoo away from ads, a plan that basically failed (fortunately for yahoo, online ads came back in a huge way). what will yahoo do if google continues to effectively sew up the ad market?
Eh hem.
This is a bunch of crap. Google has no design taste. Their applications are far from "beautiful" so watch Y! reinvent themselves. Wait for Y!'s new mail to go public and you'll know what I'm talking about ;)
Very interesting discussion! Love all of the comments. The one that points out that Google is builing a platform and does not have to own the domains where the traffic is, is a key insight and one thing that is quickly making Google more and more powerful!
That is why their mapping API has no restrictions. Google understands the advantage of that while Yahoo! has too many bean counters.
I also wonder where the lack of innovation is with Yahoo! Yes, Google is trying to build Yahoo! 2.0 in many ways but why did Yahoo! not get there first! You have all the user data, all the user feedback. So, start innovating faster!
I am glad Google is now in the game because the consumer wins! The lack of innovation over the past 5 years was quite embarrasing if you ask me.
lol i am reading a lot about lack of innovations at Yahoo! That kind of makes me smile and yet it's quite obvious people over here don't pay attention to Yahoo!
What? just cause Yahoo doesn't make a whole deal of their innovations at Yahoo Next means they're not innovative huh? Someone upthere attempt to make a comment on the Yahoo Mail beta while not even testing it. Gmail is just lost . even Live Mail is even more evolved than Gmail now. Gmail has hardly evolved in 18 months... and Google seems to want us to get all excited when it's taken them a year to come up with a small ricidulous feature like Contact import or HTML edition...WTF??
Gtalk, innovative, you gotta be kidding me.
Desktop search innovative? Google certainly did not invent it... I could go on and on.
Google building Yahoo! 2.0? well the day they'll have as many services as Yahoo! we can talk about that. Their personalized page is a joke and certainly doesn't reflect any adavnced version of My Yahoo! once again they wanted the media and then gave it up..just like Gmail. The day Google will allows me to organize my life with an AddressBook that doesn't automatically and stupidly add anyone in it, let me organize events on a calendar, let me chat with more than one person, let me have a true social network where people don't invite me to get cyber sex with me then yeh, we could talk about it yeh
In fact I do hope Google has a HUGE plan plan on their mind because i completly disagree with the person who said that there is no need of centralisation. the average joe has never heard of anything else but Google search. and thatd be completly stupid from Google to lose such traffic by not centralizing everything. So theyre either being dumb (which I doubt) or are working on a pseudo Yahoo 2.0 portal.
Now considering Yahoo Mail beta and the recent acquisition Yahoo! is heading to Yahoo 3.0. Did you really think that those acquisition was just a way for Yahoo to spread adverts??? so naive....
I don't think google is trying to build yahoo 2, because yahoo 1 is based on a premise google does not have to concern itself with.
nico - http://www.referat10.com
* Largely agree with your Yahoo 2 with one caveat. So what? Most "innovation" is simply building more effective and/or _accepted_ versions of existing things. MS hardly invented the OS but they got people to use theirs (Or else!), thus they won that early PC battle.
* Great blog, Jeremy! I do think you should "bait" Matt Cutts more so we can see you two clever insiders duke it out ....in writing of course...or maybe in Las Vegas in the ring?
I agree with Mike earlier. Google seems to have a strategy and they seem to be sticking to it(up till now at least). In addition Yahoo seems to be a little unclear with its plans. IMO Yahoo is a worth #2 to Google, but seems to lack Google's pizzazz and timing. Also the product portfolio is not exactly the same. I do not see any equivalent of desktop search and the sidebar, two Google products I can't live without, while Google has one product that I use heavily - Yahoo Music Engine, so perhaps the future is one where they live side by side along with places like del.icio.us, backpack and the likes. I think there is room for a couple of big guns and some smaller niche players. I would love to know where Microsoft will fit into all this.
I think Google is an arrogant company. The core of their competitive advantage comes from their success in Search and more importantly the success of AdSense. Adsense accounts for approximately half of their revenues and is the fastest growing revenue stream. I think the tide will finally turn when Yahoo and MSN launch their own versions of AdSense. Once the Gazillions of $$ stops rolling in they will have to make real business decisions just like other REAL companies. Instead of launching a new Google labs project with no real market (other than early adopters like people who read this blog) Until then reporters and bloggers will keep on writing about Google as if their engineers walk on water.
I think the problem that Yahoo has is that they have so many services and do so much and users have a hard time getting to some of those services. Google is having a chance to build all these services from scratch and they are taking their time. Yahoo should do more to feature all the stuff that they do.
I think you're right, but Google is aiming for more than Yahoo.
I think we need to take a head count here and see how many of us are from Y! and how many are from google.
Jeremy is making us look bad prior to getting his facts straight.
Jeremy, I meant us. Look me up on backyard ;)
Quite frankly, Google can't touch us in any property except search. That's just my thoughts...
Heh, okay.
If you're in Sunnyvale or Santa Clara, we should do lunch sometime. :-)
Jeremy
but Yahoo owns flickr--what's Google going to do about that? And maybe Google groups (beta) have improved since a few months ago, but I find Yahoo groups easier to use. Otherwise, I'm a Google fan--it's my homepage and Gmail is my homey and I'm a homebody cuz I'm a homemaker...in Marin :)
The person who said Yahoo is more community-oriented than Google seems right to me--Yahoo 360 seems proof of that, but I'm already overwhelmed by it and probably won't use it, though I'm impressed by the array of privacy features...if they actually work. When do you think Google 180 will be released? ;) I use Typepad, though, so that kind of messes up any c
Oh, and Google needs to be more Mac friendly. I'm tired of applications (like Picasa) only working on PCs. I like having my business (left-brained) apps on my PC and my creative (right-brained) apps on my Mac (laptop).
I don't know that Google is trying to be "Yahoo 2.0" any more than it's trying to be "AOL 2010" or "Visual Compuserve" or "iTeletext" or "SuperDelphi" or even "Plato Century 21". The whole "Portal" space is really another stage in the evolution of the "online services" model, which has been a sort of supercluster integrated alternative to the "RTTY/BBS/Usenet/Fido/Gopher/Web" distributed more-or-less-linked adhocracy since, well, the '70s.
Google seems to be about playing the middle ground between the dedicated-app AOL world and the random website. Yahoo and MSN are more trying to give you a dedicated environment inside the web browser.
This minute Google has a decent Calendar I am abandoning Yahoo for good. I have been with Yahoo practically from the beginning. Currently there email is slower then anything in the world and is sooooooo frustrating. I think Googles folks run circles around the Yahoo folks technilogically and guess what ... that is what is still most important at this stage of the internets development, no matter how much the Hollywood crowd screams and bellows.
NO, I do not think GOOGLE is trying to build Yahoo 2.
What I think GOOGLE is trying to do is acquire billions (and I do mean billions) of bits of information about each and every user of its offerings for one reason: to deliver just the right ad at just the right time to that user's screen. And then it wants to get paid for delivering that ad.
A recent issue of Forbes profiled the 5 hottest names [people] in the internet space, and althought I don't remember the details, the one thing they all had in common was that they were each aggregating info [billions of bits of information] to identify internet users and what they do.
GOOGLE is doing it too. If it picks on current YAHOO services, then it does so because it knows those services are popular and it can acquire more info and have more opportunities to deliver those killer ads...
GOOGLE tells you what it wants and what it is doing in its terms and conditions - just read the conditions on the new desktop/sidebar application
just my opnion of course
Bob
Google Base could easily morph into a categorized search directory like the one that first made Yahoo! a household word in the 90s. I'm not saying that's what Google's going to do with Google Base - because I honestly don't know - just that it's a possible use for it.
Google has been very smart in pushing their products. Thought you cant be mad at google for making a webmail product and not thinking of something new. Somethings are here to stay. Email is probably one of them. A calender, or agenda for that matter, is sometime people have used for ages. Ok yahoo had an online version, but i dont care if google decides to make one aswell. I'll still go with the best product, and google has the products i like the most at the moment. It's free, nice, easy, so google kinda deserves the succes it has. I don't like the idea that google is just profiting from others like yahoo, it's not completely fair...
Google is no doubt the master of its domain so to speak, but it certainly would be refreshing to see some fair competition with a new upstart. Where is Microsoft when you need them most?
