Ravi’s Blog

As all the newspapers and the web is buzzing - jerry yang is stepping down. Sad to see you step down Jerry! But who are you passing this baton to?

All the press release from yahoo seems to say is that they are going to be looking for a new CEO and when the new person is found, Jerry will transition the role. Are you pulling a Steve Jobs and staying on as “Interim CEO” for couple of years? I hope so.

Jerry - Now that you announced that you will step down once a competent CEO is found, let’s hope that your detractors shut up and let you focus on running the business. I hope you can continue your good work and kick butt with YOS ( which i think needs a lot more resources and lot more focus ). Keep the company focused on product innovation and process automation.
Also, I request you to fire those losers at tech ticker. It doesn’t help to have your employees publicly rail about every one of your little steps in the name of reporting.

I came across this september 25th post from Henry Blodget on Alley Insider. This post digs deep into Yahoo! & Google’s numbers, bringing to light some interesting differences. Basically, Yahoo and Google operate at ~60% gross margin, but Yahoo! has a net margin of 7% versus ~30% for Google.
After this great number crunching, Mr. Blodget goes on act as CEO and decide how to “improve” yahoo to make it more like google. He proposes series of people cuts, improving the overall margins to 20%. The bulk of the cuts are in sales & marketing department and R&D. He proposes ~1800 people to be let go from sales/marketing, and ~1000 more from R&D.

Here is where i think he misses the point. The assumption underlying with Mr. Blodget’s analysis is that even after cutting people yahoo! and its processes can retain the same revenues, and support the operations for those revenues. Not only that, with reduced r&d they will be able to continue to innovate, keep the product line competitive and ensure future revenue growth.

Continue reading Yahoo Fat Farm

Rumors abound that yahoo! is going to layoff “some” folks once again. Considering that these are coming from a reputable sources - Henry Blodget, Wall Street Journal, & San Jose Mercury - and with great detail, there must be a lot of truth to those rumors.

All the people I know @ yahoo! are super talented and I hope yahoo does not make the mistake of letting them go. Nonetheless, these are tough times, and my prayers with everyone of them and yahoo!.
When i recently talked to few friends at yahoo!, the mood was optimistic, and positive. I hope this continues and yahoo emerges stronger than before.

I discovered google charts api via jeremy’s blog. I have to agree with jeremy. This is a pretty cool api. I wonder how easy it is to hook up the google finance data to this api. I suppose like all financial data, the difficulty might be in the contracts relating to (re)distributing financial data and not the technical difficulty.

I started looking at code.google.com and found that they have tons of apis for various products. This is quite impressive. I like the Ajax Search API, Android, and Open Social APIs as well. One lesser known api that i wanted to use is Safe Browsing API. I always wanted to build a safe browsing plugin for firefox and IE. May be someday.

Pretty ghastly news from hyderabad, India - my hometown. Approximately 12 hours ago, some unknown terrorists targeted crowded places in hyderabad. There were 2 bomb blasts, 10 mins and 4 kms apart, killing over 40 people. Quite a shocking news.
It is hard to think of reasons why Hyderabad is targeted for such attacks. Coverage from various sources

• NDTV
• Indian Express
• Rediff Photos

Past few years have been great for hyderabad. Economy has been booming, property values appreciating and people migrating into hyderabad. It is just so sickening to see madness like this perpetrated against families going to a park. What kind of terrorist would justify this action? Strangely, these terrorist acts targeted muslims (during the may 18th attack) and general public (yesterday’s), and it is hard to see religion as a motive.
What could be the motive? Why would anyone want to target happy families looking for entertainment? It is quite shocking.

While i am thankful that none of my family or friends have been affected, i feel quite uneasy about hyderabad and the security situation. I feel terrible for all the folks who were actually affected by this. Shocking

Recent days, i started queueing my blog reading. The good part about it is that i am able to get a lot more done during the week. The bad part is that i am missing cool news. One such news is that YSlow - firefox extension - was released late last month.
Y Slow is a great firefox plugin that analyzes a website and gives a report card. In this page, yslow creator outline what the thought process behind the report card is. When you install yslow and run it on a site, you get a grade for your site. For each of the 13 items you see on the “rules page”, there is a grade assigned in yslow and overall grade is a summary of those. This is a great tool, very valuable. I was able to look at various aspects of my website - www.nesteggr.com - and figure out what i can be doing better.

Continue reading YSlow - a mini summary

For few months now, quite a few people have been calling for the removal of Terry Semel as CEO. While it may be justified for folks to call for his head, it was always unclear who would replace Terry Semel. What kind of leader is the right one for yahoo!? Who are the right candidates? Would they be interested? Getting rid of Terry Semel, it seemed would leave Yahoo! in as much of a problem - if not worse - as it is in today.

In a surprise press release, Yahoo! announced that Jerry Yang will take over as a CEO while, Semel stays on a Chairman. This is an awesome news. I have been a strong believer in the internet product vision, & leadership abilities of both the founders (David and Jerry). In some ways, i felt that they can take on more corporately significant roles in the company. It would be better for the company if they did so.
They were always active, but were content let the execution of business be lead by other business people. They have the vision, they have the appetite to take risks and more than anything, they “get it”. It was great to hear about david talking about keeping yahoo! directory open, yahoo! sports open (link to competitors) during the early days. There has been all this talk about “open” applications in the last cpl of years, but i felt that right up from the early days of yahoo! jerry & david espoused this open, free internet idealogy.

What more, with this move, they do retain Semel and hopefully, his business savvy will guide Jerry & David’s technology and product vision to bring yahoo! back to the glory days!

Congratulations Yahoo! Great Move!!

I found out about the release of y! mail api from jeremy’s blog. This is really great news. Pipes came out, it is an innovative product and all, but y! mail is one of the top 5 properties for y!. I would say the top 4 properties for y! are Home Page, Search, Mail, Messenger. The 5th spot is open and there are several contenders (finance, maps/local, international etc). Which ever property/asset takes the 5th spot, it is safe to say that the top 4 are the above mentioned.

Right now, 3 of the top 4 properties have an api. This is awesome! Om Malik leads off with ‘what took them so long?’. I couldn’t agree more. But one should recognize that this is a big step for y! and folks like jeremy, caterina had to ‘evangelize’ for a long time for these changes to occur. My experience was that everyone would agree that it is a neat idea and then it would prioritized so low that there are hardly any resources provided for projects like these. Having visible champions who repeatedly assert the message in a positive inclusive way is the only way to go. It takes a while, but that’s the best way to bring about change in large organizations.

APIs are good for the company from a strategic pov because they give an opportunity to become the defacto platform. Becoming the defacto platform ensures that their products and services are indispensable (or atleast have a longer life) to the community. Company sells its products even when outsiders innovate. To be a successful commercial platform, you need several thriving for-profit 3rd parties leveraging your platform. Otherwise, these are resources spent down the drain.

From the community point of view, APIs from big company like yahoo! means that they can innovate on top of the hardwork done by yahoo/google. This often allows smaller players to spend their effort where it is needed most and play to their strengths -innovation.

So if this is the strategic basis of why Yahoo is investing in APIs, they have to be good enough to innovate on top of. are they?

Also, since Yahoo! is both a platform provider and an application provider, there is a small problem with conflict of interest. Microsoft, had no qualms about muscling its platform advantage to win the application world. The microsoft platform strategy is to create 2 apis. One for outside world and one for microsoft. The microsoft api is inherently better than the outsiders api thus ensuring that microsoft applications are better than those of competition.

Does yahoo!’s APIs follow the microsoft path? or are they truly “open” allowing other folks to create competing applications to the one that y! has?

I took a closer look at the y! mail api. It seems pretty neat overall, but i was surprised to note couple of issues. Y! mail designates two types of mail accounts - premium & non-premium. The api developers have an incentive to promote the premium mail product. This is all good. Now here is the kicker. The API has restrictions for non-premium users. The following are the calls allowed for a non-premium user per this page

ListFolders,
ListMessages,
DeleteMessages,
GetUserData,
BatchExecute,,
CreateFolder,
FetchExternalMail,
RemoveFolder,
RenameFolder,
MoveMessages,
EmptyFolder,

Note that one can list messages but one cannot read a message. Consquently, one cannot read attachments. Noticably absent is the “SendMessage” call for non-premium users. I can see some justification in doing this. Y! mail makes money from ads and effectively, these apis are going to remove ads. So, 3rd parties can only provide full email clients to people who paid for not having ads. It seems reasonable, but not good enough.

If I am an api developer, I can build a really crippled mail front end that cannot send or read messages (just list them) and hope to make some money by forcing people to upgrade to premium users. Alternately, I can build a good, fully functional mail client for premium users from who i don’t make any money. Overall, the innovation potential is moderate.

More over, Yahoo! mail client (the one in beta for 2 years) does not have these restrictions, making this api feel very much like a microsoft api strategy rather than a truly fair platform api strategy.

These problems are going to prevent meaningful 3rd party innovation driven by for-profit parties. What is the solution?
My recommendations are:

• Open up a full api for 3rd party developers irrespective of premium or non-premium clients
• Figure out a better draw for upgrading to premium other than lack of ads
• Open the apis for domain registration, management tied into mail
• Open up the enterprise version of email via apis
• Commercial Use of APIs must be allowed with some revenue share

Some or all of these are quite hard problems. But becoming a defacto platform is hard. The good news is yahoo! is more than halfway there. They help users manage a lot of user data on y! services. They just need to figure out how to create the right structure for others leverage their platform. Getting users is lot harder than the technical/business model problems they face.

This article on ibnlive talks about how india is losing it’s shine as an outsourcing partner. There are several reasons highlighted by the report.

This doesn’t come as a surprise for people familiar close to the outsourcing business. Since early last year, a lot of the entrepreneurs i met made comments about how working with india was becoming un-economical. Friends in cisco, yahoo, hp all talk about how the companies are finding the hiring difficult, costs escalating and quality diminishing.

This is to be expected. Internet is a great equalizer. There is no reason why talented indian engineers should expect less pay than talented american engineers.

If you are running an outsourcing organization and want to stay competitive - here are few tips for you. All three of these are interrelated and you have to be really good at all the three.

• Quality.Focus on producing high quality implementations. Spend a good bit of time doing design, identify potential issues, discuss the specs and provide alternatives. One complaint i heard over and over from different people, is that developers don’t ask questions. They just develop it, and the thing invariably looks bad or fails. This includes situations where specs/mocks don’t address all cases. simple example, they may have designed a mock for a situation when user has rated an item, but no situation when user hasn’t rated yet etc.
• Communicate.Communicate status in a detailed fashion. Over communication is not a bad thing. It helps a lot especially when people can’t see face to face. People expect that as you develop, build a product things come up. It’s great if you can find a solution, but more often than not, you might have refer back to a ui designer, product manager and/or engineering manager. Take 10-15 mins at the end of every day (or when you finish a task) to write up what you did, any open issues, any help you need. Nothing irks a product/eng person more to receive a email saying ‘it’s done’ and then go look at the product to see that’s clearly not good enough to call “done”. “done” to you might mean that you did what was asked of you. Put yourself in the user’s seat to see if this is really ready.
• Timezone.All of us would like to have normal lives. Work during the day, catch a tv show in the evening, spend time with family. Working all nights is not healthy over longer periods of time and even though you make more money, it’s poorer quality of life. That said, make sure you can give atleast few overlapping hours a day with your product team that’s giving you the project. Especially, when you send the status, questions etc, wait till that person gets online and see if they can catch you. You can be available to get online late night to connect if they call you on phone. This will save time and avoid having to wait 12 hours to get a response and helps make the whole development move faster. People leading the project will immensely appreciate this.

To do these effectively, you need to have people working for your company for good periods of time (2 years atleast). It’s hard to do the above 3 cost-effectively, if your development team is churning over every 6 months. All companies are in a competitive, fast growing industry that is growing fast and they are all working hard to grow quickly, gain more business, meet needs of their customers.

Remember, if you expand by dropping your quality, you’ll damage your reputation and loose customers. Instead, if you miss couple of growth opportunities but keep the quality, you’ll retain your customers, grow more modestly, build a stronger company and have the opportunity to charge appropriately for your quality. Set a high bar for people to make it into your company, reward them well and hold them to high expectations.

Last night i noticed AT&T + Yahoo story on WSJ. The gist of the story is covered well in this article.

When i initially saw this article, I thought AT&T would be paying more to be partnering with y!. In the past 5 years y! has delivered pretty much on the promise. Y! was in a large way responsible in adoption of SBC broadband through free/discounted promotions on the yahoo network. SBC’s internet offering stood out and literally killed all the 2nd tier players like earthlink etc. Prior to yahoo!, SBC/Pacbell was viewed as old world company, with poor customer service and somewhat behind the times in technology. While SBC/pacbell customer service still comes under fire, Y! was able to give a great image for SBC. SBC/Yahoo DSL positioned SBC as just the pipe provider, which went a long way (in my opinion) in making SBC more acceptable to user. This alliance blunted the advantage competitors like Earthlink or other might have had.

Strangely though, AT&T feels that they are now overpaying. The main reason for this. Google. Yes. A familiar nemisis for yahoo!. Google is offering to pay for the privilege of being the partner to AT&T. Google can do this, by sharing revenue from search generated by AT&T users. Google not only gains search users, they gain a new set of users to push their applications to. Despite rave reviews, gmail market share is minimal. There is no reason to think that google apps will have faster growth and adoption than gmail.

What is in it for AT&T? Cash-Money. Cash-Money. Cha-Ching. $$$. Short-term Dollars. AT&T will effectively become same as earthlink or any other internet provider when they sign this deal. It might be ok for DSL (because DSL is the new dialup). It has become a commodity business, with every provider being more or less the same. Any new user who comes in, has to wonder why they have to choose AT&T with poor customer service over Earthlink (or other smaller provider) who will offer similar service with same gmail/gapps package. Price? well sounds like the dial-up story.

How does y! counter this? With innovation. Here’s my proposal for y! has to do. DSL is the new dial up. Find the next generation in internet access. The good news is the next generation in internet access has a more level playing field than DSL generation. DSL generation of providers depended on the ‘last mile’ access - giving clear advantage to phone companies. Now, the next generation in internet access is wi-max/wi-fi.

Here is my suggestion to yahoo! - Create a Program targeted at Wi-fi & Wi-max service providers What’s in this program?

1. Outline infrastructure requirements - Financial requirements, company size, cash etc & Technical requirements - coverage area, number of wi-fi points, connection speed to internet ec.
2. Self-serve or close to self serve. I want to be able to apply online, go through a verification process if i meet requirements and get added to the program. Once i am in, I should be able to get stats, view how many accounts i got etc through websites
3. Divide up the US world in geo-regions. Allow only 2-3 y! providers per area. Charge a Franchise Fee equivalent
4. Y! manages billing to the customer and sets the final price to customer
5. Pay these wi-fi providers a fixed cost for wi-fi access (determined y!) and a share of ad revenue
6. every 2-3 years the cost of providing these services to end user goes down. Y! renegotiates the fixed cost with the providers

I think what i have is an excellent solution. I wonder if y! will listen to this idea.