i had a fun lunch with a new friend from yahoo the other day and started imagining what i might do if i were ceo of that company (and if anyone would listen to me, which i know is a big if for any ceo).
first, i’d apply the 1% rule that we followed when i was at TCI. john malone’s approach was dont waste your time on any investment or new project that doesnt have a reasonable expectation of increasing the entire company asset value by at least 1%. TCI was worth $20 billion, so we had a $200 million hurdle on any significant project. seems like yahoo (which would have a $470 million hurdle) is dabbling in some activities that dont meet that but for the most part i’d give them a good grade there.
what would be truly fun to me would be making some big bets around some of their marginal or tertiary properties. i’d love to take hotjobs and yahoo personals and test some entirely different approaches to the market that might position them on top in the web 2.0 world. seems to me that both of these companies spend huge amounts acquiring their audiences (i may be off as yahoo may already be leveraging its properties well on this front). if they are spending big on acquisition, i’d love to see what happens if i turn this spending off for a quarter and substantially reduce my prices. i might find they contribute way more cashflow to my bottom line.
i’d love to take yahoo classifieds and turn it into an anchor tenant for an open classifieds marketplace. i’d make it a web service, allowing any player to pull my listings feeds into their own (with full attribution back to me). i’d encourage a bunch of existing and new players from local papers to tribe.net, oodle and others to build their businesses on top of mine. i might go even further and pioneer a new open source ebay, which might work like DNS where everyone’s listings are replicated all over the network so that anyone could get in the listings business and achieve scale. why would i do this? becuase as the biggest player, i would have the biggest share of the combined database which means that i would get even more traffic back. every player from sj merc to tribe would be ultimately sending their traffic to me for free. i might even develop value added services like user ratings and dynamic pricing that i could offer back to all these players. i’d have an advantage in building these new services fastest too. this might also increase the entire market size as classifieds suffers from continual fragmentation. if there existed a single market that all listers tapped into there would be an immediate network effect topping even ebay in power to lister and responder.
to do this, yahoo would merely need to…
- identify and publish open standards for meta data
- crawl, aggregate all other data. (oodle would be a good place to start) and then normalize and tag that data
- and then offer that data up to the world
given yahoo’s bold, impressive moves towards the new open web, i’m sure they are close to executing these or similar ideas. it will be fun to watch, even more fun to find new ways to participate.