Welcome Back to School, Techies: Now Get Back to Work!
BoomTown is back from a seasick cruise vacation in the wilds of Alaska–official sightings: lots of icebergs, 16 glaciers, a passel of jellyfish and starfish, four lumberjacks, three orcas, two seals, one otter, no moose or bears and, yep, one Republican Vice Presidential candidate’s lovely house in Juneau–just in time for school.
Or, more precisely, a little schooling for some of the tech companies that I cover in a mildly obsessive-compulsive manner.
All of them, I predict, are in for a news-filled fall.
That’s right, more Facebook employee hijinks! More BMOC-battling between Microsoft and Google! More Yahoo trying its hardest not to look like so much of a loser (Keep trying, Jerry–release your inner head cheerleader!).
Thus, here is a rundown of what to expect and also what some of those companies need to focus on over the next several months.
YAHOO: Simply put, time is running out for the languid stylings of Yahoo (YHOO) management, whom I hope have been ferreting away since the controversial annual meeting at the start of August on a plan to jack up revenues and profitability and pronto.
Unfortunately, many employees I have talked to recently still report a disturbing lack of urgency on the part of the company, whose stock has sat too close to $19 a share for too long now.
But, as many have previously observed, Yahoo CEO Jerry Yang has only a few months to prove he can light a fire under the company and be the leader he has so often promised he can be.
Job one: Cuts, cuts and more cuts is my guess to get Yahoo more focused on its core businesses–content aggregation and display advertising.
After that, it’s wishin’ and hopin’ the outsourcing online ad search deal with Google starts in October as expected and actually yields significant results.
If it does not, it’s bottoms up for the current regime.
MICROSOFT: Is it too much to ask that one of the most powerful tech companies on the planet, with tens of billions of dollars at its disposal at any one time, with enough innate aggressiveness to scare a hungry bear away, and with a legion of techies the size of the a small army, to settle on a truly successful Internet strategy after–oh, let’s count–more than a decade?
But, hey, I’m just asking.
Microsoft (MSFT) must, first of all, pick a digital chief, which it promised to do after the departure of longtime exec Kevin Johnson.
That was almost six weeks ago, but what with summer vacations, moving with due speed must be tough. (BoomTown’s bet is that Microsoft execs Brian McAndrews or Yusuf Mehdi are most likely to get the nod, as outsiders have had a harder time fitting in.)
Then the company has to decide its overall strategy to make big moves in the online ad and search space, where Microsoft is a very small player as a distant No. 3 to market leader Google.
Also, there is this annoying new parry by Google (GOOG) in the browser space, where Microsoft reigns, and the inroads being made by Apple (AAPL) in the personal computer (and, most critically, consumer mindshare) space.
Also, pick an online brand, once and for all, please. Live? MSN? MSN Live?
GOOGLE: Oh, aren’t those sprites over at the Googleplex so clever by releasing information about Google’s new browser, called Chrome, in comic book form?
Look, I am not a sourpuss, and I like the comic book.
But the company might be too clever by a half these days, I would say, if it does not show it can perform in other arenas with as much oomph as it does in its core online search ad business.
Of course, that’s kind of like saying five years ago that Microsoft better find a business as good as its lucrative Windows franchise.
But today the writing on the wall makes it more clear that the software giant is under siege, as never before, on multiple fronts.
While Google now mints money and has become scarily powerful in its grip over the entire Internet economy, I think it is only a matter of time before increased government scrutiny, worried competitors and partners, and a simple matter of corporate inertia and innovation exhaustion start to take some shine off of Google’s chrome (pun intended).
I still expect Google to keep on trying out its various schemes, from green tech to energy to–who knows?–space travel.
Nonetheless, Google must be careful as it grows not to step on too many things, including its own oversized feet.
Of course, the whole company will probably have blasted itself off to the planet it came from or will have replaced the human race with pods before any trouble starts.
But it is not so hard to imagine future life for Google will not be as side-splittingly hilarious as it is today.
FACEBOOK/MYSPACE: There are three basic issues for both companies, which are like the Goofus and Gallant of the social-networking world (and I am not saying which is which, either, because they are ever-changing).
First, there is the question of how much more they can grow their market share. While Facebook has been on the tear over the last year that MySpace was on the previous year, both desperately need to expand internationally and quickly to keep up those growth rates.
In addition, innovation of features and offerings remains paramount if the pair are to keep audiences currently using social networks interested and engaged.
(I know I am not as enamored with either as much as I previously was as a consumer, although I am, in Internet terms, 463 years old.)
Facebook just released a new platform and design and MySpace is about to unveil what looks like an interesting music service, but it’s an ongoing arms race to be sure.
More importantly, both must begin to turbocharge the social-advertising market in innovative ways and really start making some serious dollars.
While MySpace and Facebook are relying on guaranteed ad deals with Google and Microsoft, respectively, less and less, as they should, both must build substantial ad businesses for the long term.
That, of course, is the key issue. One distinct possibility for either or both is a sale or IPO (Facebook) or a spinoff (MySpace).
AMAZON: I have not studied the online retail powerhouse as closely as I used to (but I will be doing that this year, as promised).
Still, here is my thimble-sized take so far:
Love the Kindle e-book reader, think it is innovative and headline-grabbing, but it is simply not a huge or very profitable business at this juncture.
I am more interested in how deeply, quickly and profitably Amazon (AMZN) can push into the much larger business of digital distribution of all kinds of content.
Also, how it can even more efficiently sell more physical products. First and foremost, Amazon is a retailer, and how well it sells is what makes it successful.
WEB 2.0: Well, there are 3,265 Web 2.0 companies out there with valuations of $500 million.
Okay, I exaggerate. It’s 2,730.
All these cannot sell to the big boys. All cannot live by advertising revenues alone. And all these cannot become real, standalone businesses, although many can.
In other words, shakeout!
Thankfully, since few of these companies have been able to go public, as in the Web 1.0 era, it will be the venture investors who suffer (not the venture capitalists, of course, who always get paid).
It will be very interesting to see how it does shake out though, as there have been some really terrific and innovative ideas to bubble up from start-ups in this cycle.
Still, make no mistake, it is a cycle and the wheel always, always turns round.
But no matter the karma to come, let’s keep in mind the singing messages from one of the wisest movies ever made–which, it goes without saying, people, is the original “High School Musical”: We’re all in this together.
OK, this is not true of the blogosphere in any way whatsoever because we just love a good fight and carnage. But all you techies are just like one big rollicking high school.
To remind you, here is a video of the whole gang from “HSM,” including the pure genius of Ashley Tisdale as Sharpay, singing “We’re All in This Together.”
(And even better, the trailer of “HSM3: Senior Year,” which comes out–psyche–Oct. 24, below it.)
(And a big shout-out to Louie Swisher, who heads to the big time of first grade today. For my six-year-old start-up, I predict a thrilling year of reading, writing and ‘rithmetic.)
Please see this disclosure related to me and Google.