Two immediate questions came to my mind when seeing the Microsoft – Yahoo! Search deal: “Now that Microsoft has got Bing, what else do they want from Yahoo! Search?” and “Is this a favorable deal for Microsoft at all when they still allow Yahoo! to sell ads on it?”
And so I come with a scenario: Microsoft is playing a different game, by looking more into the future.
1. To lower bargaining power of Facebook
By having data from Yahoo! Search under his arms, Steve Ballmer has more bargaining power against Facebook, and additionally Microsoft has a fall-back plan should the relationship with Mark go sour.
It’s a big deal, now that social media are devaluing search power greatly, directly hurting Google’s business.
2. When it comes to Microsoft technical expertise, ain’t no data the same
Bing’s data will be different from those of Google. While Google has vast amount of diversified data, Bing will have data about people’s consumption preference, the arguably most valuable set of all customer information on the internet. Why? Because Bing positions itself as a decision-engine for shoppers first and foremost.
Data from Yahoo! Search will also be different, thanks to some very nice verticals Yahoo! is currently having. With their superior technology, Microsoft surely knows what to do and how to mine the data.
So, I have put on an argument that answers the first question: apart from making Bing the second competitor overnight, Microsoft will have the data it wants and enhance its control on many battles.
3. To create a precedent
It’s simply as that: Microsoft has made a precedent in buying a Yahoo! asset and more importantly, tying Yahoo! with a ten-year contract. Now that Yahoo! is having some nice products and platforms such as BOSS. What’s bad for Yahoo! will be good and cheap for Microsoft.
4. To make it useful and clean at the end of the year and in a decade
Financially, not paying up-front will make Microsoft’s balance sheet very clean at the end of this year.
Strategically, luring Yahoo! into a long-term deal will only turn the tide to Microsoft’s side, who has the cash powerhouse to pursue a real war with any competitor.
So then I have answers the second question: this deal is sweet for the giant.
What do you think?
1.With Facebook, blogs, forums, Twitter and such, you and I – normal people – can make our voice heard. Just 5 years ago, we could not have possibly done that when mainstream media still dominated (via @TanNg).
The event of Michael Jackson is not an excuse to assess whether Facebook or Twitter has won , but an opportunity to see how many more people Social Media as a whole have conquered, and how much change Social Media have created.
Outcoming Influence, not Incoming traffic.
And appropriate collaboration would enlarge the pie for all.
Facebook has developed from Relationship-centric to:
- Quiz as representative
- Entertainment portal
- Viral channel
- Pushed to the right column
- Built on interests rather than real relationships
- Growth: people sharing different interests will invite their peers
- More interactions between users, more retention
- Users are more willing to show off their data about their interests (consumer needs!)
- Segmentation of users basing on their demographic
- Devalue other interest-based social networks such as Twine, Squidoo
- Social-graph based monopoly
However, this is only an interim state of Facebook in the way to becoming far greater an information hub.
Ted McConnell, Procter & Gamble’s head of marketing, has been famous with his exclamation “What in heaven’s name made you think you could monetise the real estate in which somebody is breaking up with their girlfriend?”
Was it because Coke is the #1 brand in the world? I don’t think so, because P&G is also one of the top brands. The difference in brand awareness between Coke and P&G products should not account for the large gap between the two pages on Facebook.
Was it because a Honda product was more expensive than a P&G product? I don’t think so. A can of Coke and a bottle of shampoo would differ much.
So what accounts for the difference?
Because it came down to the core value of Facebook: relationships first, and ego second.
People go on Facebook to gain benefits from relationships, and respectively reinforce their connections.
A can Coke is not simply a piece of beverage. The can of Coke is enjoyed by people when they hang out with friends, have lunch at McDonald’s. What are these activities but reinforcing relationships.
There is a direct, strong connection their in their behavior.
Meanwhile, a bottle of shampoo might be a little private. People have no need to show off their brands of their convenient goods because, sad but true, it doesn’t make them feel ‘cool’ or accepted.
People show off things to impress their peers on Facebook, that’s why they do with Coke, more than with convenient goods.
A Honda feeds a consumer’s ego. Mostly everywhere, a vehicle is only less important than an apartment in people’s purchasing decision. It is common knowledge that people don’t only buy a car/motorbike, they buy the brand and the culture associated with it. They want something that makes them ‘cool’. A Honda does.
Again, a P&G product, while makes people good, clean, safe, and healthy, has little say in a consumer’s inter-personal interactions.
Sadly, it all comes to the game of perception.
How does it relate to Facebook? Well, as a person shows off his Honda, he feels that his ego is fed. This does not normally occur with showing off something in his private spaces.
There’s nothing and no-one to blame here. And I am proud to say I’m a big fan of P&G. But, as a matter of fact, every real estate has its own norms.
I would still love P&G’s conventional messages, so please don’t let one campaign hinders any further campaign. You’re cool no matter what, in very different spaces.
Yahoo! 360 is officially announced to be closed on 13 July 2009.
The impact this movement has:
4 million users worldwide and 2 million Vietnamese users lose what they call “home-base”.
Vietnamese bloggers had long equate “blog = Yahoo! 360“. The closure will change that perception.
Where are they moving to
I have noted down my prediction on Kevin’s blog here.
I have personally moved most of my social graph to Facebook.
- Yahoo! loses a global product which has been a bulletin board.
- Opportunity for Yahoo! 360plus.
- Yahoo! Profile has won the battle against its siblings.
- Yahoo! Feed looks promising amist.
- Full focus on Yahoo! Open Strategy.
The global forces: Facebook is climbing Alexa Vietnam rapidly.
Local competitors: good news?
How about you? What impact will the closure have on you?
How Baomoi can make (more) money apart from offering brand-monitoring services.
- Get online newspaper firms to outsource to Baomoi for features that Baomoi is strong at
- Offer new, innovative, customized features to newspapers
- Provide online-news-specific analytics
- Create ecosystems around newspapers
- Move Expand to media, collaborate with other organizations to host news-related events
Each item has its own pros & cons, opportunities & risks.
This list is simply my own fresh thoughts, and I haven’t evaluated them against Baomoi’s strategies, current capabilities and the industry’s growth. Feedbacks are welcome.
The sky above The University of New South Wales, one day before Mother’s Day 2009.