Google Archive

Ooooooh! Maybe Valley Innovation Is about to Restart...

As a Valley-based business reporter I get chills (the good kind) when I read Jim Cramer -- or another of his pretending-to-get-tech Wall Street peers-- say something like this. Because as soon as people say innovation is dead in the Valley, it seems to slowly restart. Among other bon mots, Cramer told an audience at New York's "Hey! Us too!" Internet Week that there was more innovation going on in the Rust Belt than Silicon Valley.

I've been outspoken that there's not a lot of great Web innovation going on right now, but Cramer's statement is a stretch even for me. You know what Cramer misses? (Other than the under the radar work happening in clean tech, biotech, etc. The Valley is a big place after all.) He's focused on product innovation, which has somewhat stalled in the Valley's Web scene in aggregate. But business model innovation is where the Valley is at as Web companies and others in areas like open source hunt to find ways to turn insane audiences into cash. Memo to Jim: That's what made Google worth $175 billion today. The search engine was hardly a new-fangled application.

What I love about guys like Cramer is they tout they were rabid Google bulls "early on." Early = Once the S-1 was filed and we all saw the kind of numbers Google was putting up. Props to them for knowing the stock was worth more than $85 a share. But that's not the same thing as spotting "innovation," Wall Street. Just wondering how often Cramer actually comes out here....because I seem to see him on the Mad Money set just about everyday...or goes to the Rust Belt for that matter...

All snarking aside, I don't usually bash Cramer, because I think he's an amazing showman and knows the public markets better than I do. And I have a total appreciation for the rigors of being on camera everyday. But don't try to play the startup game, pal.

Oh! My favorite part: Cramer says TheStreet.com is one of those lone well positioned Web properties. Because so many young people are flocking there. Yeah, that one doesn't even need a snarky graph.

Preview for Your City?

A video of the reading I did at Google last week

No, It's Not Game-Changing

Here's Henry and Aaron's coverage of Microsoft's announcement this morning. Although Henry says it won't work, I think the "knobs" (as they're affectionately known in-house thanks to a snarky Yahoo commenter) give way Microsoft too much credit for creativity and strategy here.

Search engines that reward people with prizes and cash have been tried before with the idea, "If you're searching anyway, why not search where you can make money?"  Because I don't search to make money. I search to find information fast. A few pennies here or there isn't going to pay my mortgage. It's not enough of a value add to accept an inferior search engine (sorry, MSN still is. It pains me to say it, but Yahoo is too) or even enough to change basic customer habits. I don't even have ads on my blog (yet) because the take home would be so low, it wouldn't be worth even a marginal annoyance to my readers.

Similarly, there was a big debate back in 2006 about whether or not user generated content sites should share in advertising fees with their content creators. The most famous example was the smack-down between Jason Calacanis when he was running Netscape and Digg. Calacanis was actually offering substantial money to switch and few top Diggers did. I have long said the key to successful UGS sites is tapping into human needs like connecting with friends and validation. Those are so much more rewarding than cash. People use and love these sites because they are not work. I don't want to get paid by Facebook, I don't want to get paid by Yelp, I don't want to get paid by Digg. I want to use the sites because I love them and conversely I want the founders to have to WORK to retain me as a contributor. I'd rather them plow that money back into making the site better than give me a cut.

In short, this strategy is only new and innovative if you have a time machine. And it has almost never worked. Nice try though, Redmond!

Carl Ichan: Company Breaker or Wall Street Saviour?

I've been amazingly quiet on the latest Carl Ichan twists of the Microsoft-Yahoo saga. While the day-to-day news makes for fascinating early morning -- and increasingly weekend-- reading, I feel like we're basically saying a lot of the same things we've been saying from day one: The company belongs to the shareholders, Yahoo will eventually have to sell. I also always have to be careful reporting on this since I spend three days a week at Yahoo and want to respect the privacy of co-workers who talk about the deal as friends, not as sources. So, as I have to disclose all the time, I only report things I get from Yahoo sources, not as a Yahoo contractor.

All that said, Tech Ticker is about the view on Wall Street meeting the view in the Valley and there is no one who divides ranks more than Carl Ichan. Many people in the Valley view him as a destroyer of company value-- many people on Wall Street view him as someone who shakes management into unlocking nascent company value. (The fact that Ichan doesn't even own a computer certainly doesn't help his rep out here!) And ultimately, when you go public, the Wall Street view wins.

Here's some great analysis from Henry and Aaron today about Ichan, what his end game is and how much he's made so far. (As usual Henry can't seem to contain his excitment!) Also, they bring up a WSJ story that says Carnival has a faster growth rate than Yahoo. That might be the most damning stat I've seen. I've long argued that it was a management misstep for Yahoo to try to be Google, and continually allow itself to be compared to Google. But if you've got Yahoo's assets and can't grow faster than a cruise line that Kathy Lee Gifford used to shill for....Well, just watch because Henry says it better than I could.

Happy Hour

Me on Happy Hour on Fox Business News. Despite the name you actually *don't* drink on the show! Enjoy!

I School the Yahoo "Knobs" on Facebook...Again!

All East Coast-West Coast smack talking aside, it's always fun to be here for a few days. Somehow I walk onto set with Henry or Aaron and my sleepy, red-eye jet lag just washes away! (BTW- we hope to have a very special guest at the Nasdaq tomorrow! If you are reading this, please don't bail!) Watch for the 2:30 mark when I got all Henry-Blodget-spazzy on Aaron!! I think HE brings it out in people!

Btw- it occurred to me after this segment that Zuckerberg may be back in the US for the Time 100 dinner....but he was out of the country. I swear!! Either way, I don't think he's been running back and forth between Google and Microsoft ramping up a bidding war.

Possible Solution to Broken Public Markets?

Could it be this easy? Marc Andreessen has a post on the benefits of dual class stock that you have to read. I know it's long, and you like short posts. So do I. Just pace yourself. Pack a snack. It's worth it.

Here's why:

We have a major, major problem in the U.S. capital markets that is hurting innovation, our economy and ultimately society. Yes, that sounds dramatic. Guess what? Things are dramatically bad for public companies. I'm not supposed to quote my book before May 15, but screw it. If you've been at a dinner where I've had a few glasses of wine, you've heard the rant anyway:

Sue Part Two

In case you haven’t checked it out on Tech Ticker yet, here is the second half of my interview with Yahoo’s President Sue Decker. In this segment we focus on the future for Yahoo, including possible deals with Google, AOL or News Corp. Also, we ask about those high fives….

As usual, there's mass voting and commenting on Tech Ticker (including all the usual Sarah Lacy haters, no doubt!) Would love your comments here too!  (Now, back to my regularly scheduled, four-day late BusinessWeek column….)

Sue Decker Speaks!

I'm not going to lie: It was a long day at Yahoo today. Some 16 hours long, not counting my commute from SF to Sunnyvale, back to SF, back to Sunnyvale, and one day-- I hope!!-- back to SF. But we emerged with the exclusive interview of Yahoo president Sue Decker. I was actually pretty impressed with how she handled things. I've said it before and I'll say it again: Yahoo has generally been a champ about our using one of their biggest assets (Yahoo Finance) to dissect their job performance. If you watch our coverage it's been as tough as anyone's and we all still have jobs. (Knock wood, of course.)

Video is below, but click through to Tech Ticker to vote, comment, and read my blog on Yahoo.
Of course you are free to comment here too!!

Googling, PayPaling and TiVoing Away

Amid my beaming pride for my book subjects Mark Zuckerberg, Michael Arrington* and Jay Adelson being named as a few of Time's 100 Most Influential People, I read something that annoyed me in Jay's write up and it has festered for days:

"For a web company, there may be no better definition of total, unconditional victory than seeing your name become a verb. So far, that club includes Google and...nobody else. But if you had to predict the next tech brand to make the leap, Digg would be a good guess."

Google is the only one??? First off, with more than a million users "Digging" stories, I'd give Digg verb status. And I'd say others have definitely made that leap. More than a hundred billion dollars are "PayPaled" around the Web every year, and a sportscaster on TV just made reference to "TiVoing" something. (OK, TiVo isn't pure Web. But was made possible by the Net's connectivity and a 1990s boom-baby so I'm counting it.) And what about "Oh, snap! I've been meaning to NetFlix that movie!" Any others I'm missing?

[*While there are several chapters devoted to Jay and Mark, truthfully, Arrington only shows up in a few brief scenes in the book. So if you are some crazed Arrington mega-fan, I don't want you to buy it and be disappointed.]