Has Yahoo doomed itself?

I wanted to briefly comment on the impending takeover / buyout that Microsoft and Yahoo have been working on in the last three months. I just finished reading the article, Microsoft in Quandry over Yahoo Bid and I think the article’s conclusion is pretty spot on: Does Microsoft really need Yahoo anymore, at any price?

I can recall my earliest experiences with the internet involved Yahoo.com, and since then Yahoo is still my preferred portal for accessing the web. But truthfully, when I do searches, I too am one of the millions that choose Google over Yahoo (and, for that matter, over MSN and Live.com). For some reason the Google way of doing things and the brand impression are quite secured in my mind… When I want news I visit news.yahoo.com, when I want to find something - I’m a Google.com visitor. I even have the Mozilla-prescribed Google toolbar to make searches that much closer and quicker.

Yahoo, fundamentally, has lost its sense of self. For a long time the human-organized directory was a great way to browse the web. You could count on finding relevant information fairly quickly, and thanks to the Yahoo folks that ran the directory, there was a good chance that things were properly categorized and organized. But any more, Yahoo’s services seem stretched apart and disorganized. Yahoo 360 was an abysmal failure in the social networking arena (hmmm, come to think of it so was AOL’s AIMPages - social networks aren’t so easy are they?), Flickr is still super popular but under-served, and Yahoo can’t seem to sort out what is at the center of their empire. Being a starting point on the web ain’t bad, but being a destination is another thing entirely.

Fundamentally, I believe the Microsoft / Yahoo deal was a good offer, made with good intentions from Redmond to quicken the pace of innovation and give Google a serious run for their money. Right now, with MSN and Yahoo fighting for users, it leaves Google to stay in the lead - and reduce the amount of innovation that is coming out of all 3 destinations. A combined Yahoo / Microsoft could’ve at least held the race tighter and provided us - the average web users - a new round of gamesmanship.

There’s still no telling yet whether or not Microsoft will enter a proxy fight for the Yahoo board, but at this point I’m siding with the article… Don’t bother. Yahoo hasn’t pulled off any hat tricks in a while, and it looks certain to falter if the Microsoft deal doesn’t go through. To add insult to injury, it seems like the bulk of this fight is over the last couple of percentage points on the deal… The difference between $44.x billion and $45-50 billion is marginal.

As a long-time Yahoo faithful, I hope the directors of the company know what they’re doing. The web needs these companies to find common ground, and build the next generation of the Internet.