Why Yahoo can't seem to shake up Google

Chess begins with the board set up exactly the same way every game. So it is in business, entrepreneurs have a concept and a desire to create wealth with that concept. Yahoo Inc. (NASDAQ:YHOO) sat down at the game board in 1995, Google Inc. (NASDAQ:GOOG) took its position in 1999. In essence, their game didn't get fired up until 2000 but what a game it has been.

Yahoo's game plan began as a very hands-on, meticulous project with its content categories logged in by hand. Google's game plan began as a quick-hitter play, streamlined and fast, to quickly engage the user base the company sought. Although Yahoo did have a big head start in the game, it was a slow start. When Google jumped in nearly five years later, it pounced directly upon Yahoo right where it sat.

Initially, chess begins with an envisioned mental strategy. It involves opponents choosing the pieces of power that they most desire to play with and then opening them to the board. Much movement and positioning goes on and much forward vision is employed. For both Yahoo and Google, this phase has involved development, IPO, numerous acquisitions, heavy advertising and consumer awareness programs. Yahoo! has excelled in the realm of public awareness and is still the most visited name on the web with between 3.5 and 4 billion page views a day. Google has fared much better with the investment world and in the category of search, holding sway over more than 50% of the search market against all competitors. Yahoo! chose to play the pieces of public interest. Google chose to play the pieces of business promotion.

The game continues with the taking of pieces thus creating shifts in the balance of power. That's where the Google/Yahoo battle rages right now. In overall power, our two web players are fairly well balanced, but it is the dynamics of the game that I find the most interesting. The reason that I claim Yahoo! is losing the battle is a concept that the game of chess has taught me very well. When your opponent has arrived in a position where all he or she can do is react to your moves, then simply playing out your own game free from damaging errors will result in an uncontested victory every time. This is what I see happening between Google and Yahoo right now. Every time Google makes a move to sculpt or expand its business, Yahoo! reacts with a similar type move. The latest example in this copycat scenario are the parallel newspaper deals which have been launched by our two players.

If Yahoo! wants to get back into this game, in my opinion it has to stop this band wagon type thinking. Yahoo! needs to show its investors that it can do more than just react to what appears to be up and coming. I need to see some inventive experimentation and forward conceptual thinking coming out of the Yahoo! corporate think tank before the company gets any increased respect from me. In my opinion, if Yahoo! keeps simply reacting to Google's moves, then very soon something similar to checkmate might happen for Yahoo!