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Saw this interesting post on TechCrunch regarding some Delicious engineer's viewpoints on why many of the acquisitions ended up failing.  As expected, politics played a huge role in preventing these acquisitions from growing within Yahoo.  Probably, many existing Yahoo management felt threatened by the acquisitions and complained to management in order to satisfy their positions.

For myself, I've seen this happen in other companies.  The problem I think is that you got these MBA or long time middle management types that infest these companies and play behind-the-scene games to retain what little power they have in the company.  Why do I put blame on these people above all else?  In my experience, these people often have little to contribute, especially in tech companies or departments.  Yet because of their degree, they are able to get into high levels of management that give them power over engineering that they probably would not otherwise receive.  For instance, I heard Activision and EA suffer in this regard, which is why, with the exception of Blizzard, companies that get bought out by these two end up having tons of problems.  BioWare is a good example.  I heard from a friend that both companies would hire MBA types from prestigious companies and universities.  However, these people had little to no exposure to gaming and quite often would not care about games.  For me, that makes them absolutely unqualified to partake in the industry.

What's more interesting is that TechCrunch, a day or so ago after the Delicious fallout, revealed that internally Google is providing more autonomy for acquisitions by allowing them to act as individual business units, except with greater resources at hand.  This is exactly what any company who plans to do large number of acquisitions should do to maintain agility.  This shows for one that Google is one of the smartest companies around, but also demonstrates a practice that, imo, allows for the greatest benefits.

The thing I see in acquisitions is that you want the intellectual property, the userbase and the talent.  The way Yahoo has handled their acquisitions make it seem like their plan was to prevent competition.  But once acquired, these companies would practically cease to exist or remain perpetually locked into integrating themselves with the parent company's infrastructure.  That partially makes sense for website acquisitions because you probably want to share infrastructure (servers, user base, marketing information).  However, you cannot forget about the community aspect that has supported the site.  That means, continuing to maintain the core site and add features that the community wants.

Another major issue that has surfaced is internal competing products.  A prime example is Yahoo Photos vs Flickr.  I used to have a Yahoo Photos account, which I thought was great....prior to the upgrade.  Then for some reason, Yahoo decided to upgrade the whole thing to compete with Flickr (which apparently was getting acquired).  The worst aspect was that the new Yahoo Photos marked virtually all my albums as having adult content, thus disallowing me to share.  I don't know how they managed that, but my photo albums contained pictures from Japan of landscapes, Las Vegas, friends, etc.  Probably, the only "adult" related picture might've been my friend's girlfriend dressed in a bikini while drinking a cocktail.  What was more brilliant was that Yahoo shortly thereafter shut down the service, migrated my photos to Flickr and told me that I had to pay to show my photos. That was utter bullshit. I stopped using Flickr and tried finding competing services, but it clearly demonstrated Yahoo's negligence and lack of understanding of community relations and potential internal politics.

Of course, my biggest complaint had been Yahoo's whoring themselves in terms of leadership and identity.  When Terry Semel tried his hand at being Yahoo's top dog, Yahoo looked to have been moving towards becoming a "media" company.  Figures because that's what Semel's background is.  However, Semel isn't a tech guy so companies like Google completely blindsided him.  Yang's one year residence as CEO showed a gutless failure who buckled immediately.  I guess for Yang, playing Golf with other billionaire friends, politicians and stars was more inspiring than re-building a major internet company.  And Carol Bartz.....ugh....where to start with her?  I think anyone could see that she's not real CEO material.  At least, not where we expect (or want ) from a company like Yahoo.  The only thing we've seen are bad deals and a trimming of the fat.  But that hasn't led Yahoo to anything outside of bad press.  And when asked what Yahoo is, Bartz claimed that Yahoo was some odd mixture of different pieces of the internet.  Not too dissimilar from the vague cloud that used to define portals.

Here's the thing.  I've said it before and will say it again.  Yahoo's primary two positives are its brand name and sheer reach/connections.  That's where Yahoo needs to start as a company again because that's all it has left.  Forget the stock price.  I think Yahoo should go back to being private and restructure itself internally to once again become attractive to shareholders, rather than splitting Yahoo's control up even further.

As part of the restructuring, I say cut all the fancy middle management MBA types.  That's the first thing that needs to go.  Keep the engineers and product people around as well as anyone who appears to be an innovator.  If Yahoo wants to compete as an internet property, they need to still value technology to a high degree.  You cannot ignore that aspect in this economy, even though Bartz and other high level people may argue otherwise.  Next get rid of Bartz.  Lets face it.  Is Yahoo better off now than a year ago?  The layoffs and internal memos tell a different story (although it's said that their revenue is up).

Next start using that brand name and connections.  Yahoo in Japan is still big (for whatever reason).  And I'm certain people still recognize the name, even if it's been damaged.  Where Yahoo can do well is the media outlets it's connected to.  My theory, as I had pointed out previously, is to make Yahoo a media internet operating system.  People might think that YouTube is the media internet OS, but I have a different view on what this concept is.

In my view, media != videos.  Media != playing music.  Media is a medium of information transmission.  So any kind of information that exist would (or could) be transmitted through a Yahoo.  News, videos, music, events, etc.  As a media OS, I want to see services and plugins that can extend my site's capabilities and make me look more attractive.  This idea is NOT the same as being a content farm (such as the way Demand Media is described).  Instead, I want to be able to pull information like all the actors names from a movie, the ISBN number for a book title, the excerpts from a news article, etc.  I'm certain Yahoo contains all this information.  But not only do I want to pull this information, I want to pull it fast and I want it to be accurate.  Outside of companies like Amazon and Google, Yahoo might be one of the few capable of providing services like this.

Yahoo does provide some limited capabilities in this area.  For instance, YQL allows you to grab artists information.  But I've found the information to be unsatisfying and not easily organized.

More importantly though, and I'm stated this previously, I want to get this information without penalty.  That means, no copyright infringement BS, no limits on API calls, no stupid contract.  I want unmitigated information so I can build my property up.

I think Yahoo can pull this off.  This is the type of deal Terry Semel should've been working on as a CEO.  Google's APIs limit what kind of information you can pull while other sources put even more restrictions on how you use that information.  For Yahoo to grow again, they have to become relevant.  What better way to become relevant than putting a massive investment in getting people to use them again through some form of open ended license?

Now, if there is one license that Yahoo might introduce to make it worth their while, it would be that Yahoo should have in the contract that if a website becomes significant in using their service, then Yahoo has first rights to buy that website out.

The money that Yahoo would spend in this is for servers, engineers on this type of service but more importantly on some sort of agreement/partnership fee for distributing this kind of content.  Website operators could simply credit Yahoo services and the copyright holder as part of their content display.  For instance, kinda like showing a news article is derived from Reuters and written by a certain author.

Although any major company could probably pull this off, I'm focused on Yahoo since they're the ones that need to get back on their feet.