Posted December 14, 2006 9:58 am by with 6 comments

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Venture capitalist Paul Kedrosky is predicting Yahoo can outperform Google in 2007. His reasons include:

  • Yahoo needs to grow earnings faster than Google to regain investor interest
  • It can do that by cutting costs, growing audience, acquisitions or improving monetization (or some combination of all four)
  • It is easier to drive monetization than to increase audience markedly, and acquisitions are a mug’s game without better monetization tools. Cutting costs is a non-starter.

I agree that Yahoo’s likely hit the bottom and is ready to bounce back, but I’m not convinced they’ll be able to gain enough momentum to outperform Google in the next twelve months. Looking beyond 2007, they could just do it, especially if the backbone of their new search marketing platform (Panama) is as robust as the front-end interface.

Speaking of Panama, how many have switched over to Panama? What do you think of it? Many Yahoo peeps read this blog, so leave a comment and you will be heard!

  • I can see why Paul might make such a prediction – Yahoo is one of the (if not THE)largest viewed website on the ‘net. However, Yahoo simply does not have the same business models set-up as well as Google does. Look at their Adsense Network – how much money does that make Google ever year? Alot. Simply put, Google makes more money with less page views and visitors; it makes more with less; it’s a smarter company (yes, I said it). My prediciton: Google stays on top, Yahoo stays put.

  • Interesting topic. I do think Yahoo can surpass Google. It’s all about search. Doesn’t matter if Yahoo has an improved search advertising platform on the back end if it doesn’t have more traffic on the front end. Whether that front end traffic comes from itself or on other Yahoo properties or on other sites, it doesn’t matter. That’s what Yahoo’s got to tackle for 2007 and beyond.

    Let’s look just at core search. They have to take market share away from Google. They can’t settle for being #2. But, how can they get people to switch from searching via to Make it!

    In a post called “Google Concedes Yahoo has the Answers” (written 11/29 on my blog) I suggested a couple of ways Yahoo! could leverage its social bookmarking service to differentiate its core search product from Google’s. That blog entry had quite a few visits from corporate Yahoo! IPs. I wonder if they concur with some of those thoughts? More recently, VC Fred Wilson wrote a post on 12/7 where he suggests using as the foundation for a killer social search engine.

    If Yahoo can position its core search product as social, a search engine augmented by people as opposed to Google’s purely algorithmic search, it can take market share, IMHO. If it fails to take search market share away from Google in 2007, it doesn’t matter what else it does. Search is where the money is – for 2007.

  • I think Yahoo is doing social search and social networking much better than google, at the moment. Yahoo should easily be able to capitalize on their success with Answers, and several other big pushes by their well engineered management team of social media developers.

    Google has a fighting chance with the Youtube acquisition, but the move is already going to mobile, whom ever wins the mindshare for mobile search will claim huge marketshare in 2007.

  • I agree that Yahoo is ahead in the social aspects with and flickr. Is Google going to just stand by and let them win that end without a fight? No way. And when Google makes moves ala YouTube, they’re really big moves. AOL. MySpace. YouTube. These are big moves compared with little moves like and flickr. Plus, Google has it’s $#@! togther on the inside.

  • One approach would be to implement a new “paid match” PPC ad platform I’ve come up with (pending patent #11/250,908) where advertisers would be able to select and bid on the actual demographic and psychographic traits and characteristics (keytraits) of their most desired customers; instead of just the words people enter into search boxes.

    If they were the exclusive provider of such a system, and made it available on their home page (as well as e-mail notifying their 100+ million already-identified customers/users of its availability), because people would only be able to utilize paid match at, they’d be able to grab, perhaps, as much as 10% (maybe more) of Google’s search share for themselves.

    This would be in addition to enjoying the many benefits of a brand new patent-protected income source of some billion dollar+/year (w/in 24 months of paid match launch).

  • No doubt yahoo is doing very well but here google is also adding much more to it’s service. Both are equally good, I think.