On the Yahoo/Bing search deal

Firstly a disclaimer: I know a number of Yahoo!/flickr people, including a few who were previously involved in search.

I think the deal was inevitable, and starts to define what Yahoo! actually is. Can it defeat Google, I’m doubting that, but I think that when you’re in the market dominance that Google has you really need to have bigger competitors. In search Microsoft could be an oil tanker, and that once they really get up to speed that bing will start approaching Google as a bigger challenger. I’m not cheer-leading the deal here, just thinking that neither party had much option when they were comprehensively outgunned.

Anyway, much of the negative coverage, in particular this article shared the same character. The tone. It was all “Yahoo! was” “Yahoo! should have” “if I was in charge I would have”.

Yahoo! is where it is. It’s lost market share, advertising revenue and focus. Search is expensive to run, and if you’re in what appears like ongoing decline, then a strategic retreat could make sense.