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My Yahoo! Years, Part 4: Racehorses Run to Death

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Have you ever been to a thoroughbred rescue? Those horses aren’t all losers. Some were stakes winners, but they were gelded, meaning that no money could be made from breeding stud fees and so they were often run until they could run no more or started losing and then cut loose — donated to a rescue or a slaughter house. Even former Kentucky Derby winners can end up that way.

If that reminds you of the book Animal Farm, it should. Loyalty wasn’t necessarily rewarded because regardless of any ideology, Yahoo! was a business.

While I was at Yahoo! Search Marketing, there was a lot of mumbling and grumbling. Originally, when Yahoo! bought the Pasadena-based Overture, after the job anxiety had passed and we knew we were still employed, there was joy. Could anyone think of the Internet without thinking of Yahoo!?

Overture, originally called GoTo, was founded in Pasadena in 1997 out of Idealab and bought by Yahoo! in October 2003 for $1.63 billion. The quarter before the acquisition, $25 million of Yahoo!'s revenues were brought in by Overture. Google's billions in revenues are from the monetization from Web searches and based on Overture's original ideas of pay for performance.

In spring of 2005, Overture, now renamed as Yahoo! Search Marketing, began moving to Burbank and by early summer of 2006, the move was completed.

Theoretically, it was a good investment. Yet as time passed, the joke made by some Overture underlings was that we were Yahoo!'s unloved stepchild. That perception was not so far off.

Former Sunnyvale Yahoo! confirms this sentiment in his ruminations on what's wrong with Yahoo!:

Yahoo! makes its money from advertising. To make money in advertising on the Web, you need to have "inventory" (popular Web sites that a lot of people visit). But you also need a way to sell those ads. You need tools like campaign management, analytics, budgeting, reporting, A/B testing, and a whole host of others that are compelling, easy-to-use, and generally encourage advertisers to spend as much money as possible. In short, you need to meet the needs of advertisers, who in turn will give you money.

This former employee had worked on the inventory side (Mail, Messenger, Photos, Groups, and 360) for three years. All he knew about ad sales was they had a requirement to include space in the design for standard units. No surprise. What was surprising was his attitude. When his colleague in research wanted to go into product design, he suggested to go to the ad sales group where he believed, "there was a ton of low-hanging fruit and a ton of opportunity to tangibly improve Yahoo!'s financials."

In retrospect he wrote:

I only now realize how bad that sounds. Why would Yahoo! treat such an essential piece of the business a second-class citizen? Why should that be the entry point for a rookie designer? Why isn't that where the rock star designers go after paying their dues on the "lowly" inventory products?

Far worse was the reality. He wasn't alone in his attitude. Apparently many of his colleagues thought that Overture, which had become Yahoo! Search Marketing, was just a small operation — not one that would expand in Burbank as well as overseas in India. He wrote:

A friend of mine who was a PM at Yahoo! shared his story of going down to LA to visit the Search Ad Marketing team. He was shocked. He said it was huge; at least as big as the main HQ; maybe bigger. It's the biggest secret Yahoo! is keeping from its own employees.

It was, by the way, no shock to those people working at Burbank. Some had visited the Sunnyvale campus and knew about the perks they had there that would not be offered at the Burbank campus. We didn't have Music on the Green concerts featuring Beck or Taylor Hicks. We did not have an Influential Speaker series because Tom Cruise's Hollywood house is closer to Sunnyvale than to Burbank. So, naturally, Yahoo! Hack Days, Yahoo! Design Expo and Big Thinker Distinguished Speaker series wasn't something we were really a part of although we could watch it online from our desk, during our breaks.

Are all Internet companies run that way? Apparently not, according to the Sunnyvale Yahoo! guy.

This in contrast to Google. When I interviewed there in late 2004, they made it quite clear there were two main groups: end-user web sites, and advertiser (plus internal) tools. The groups were equally well respected. Both groups got similar exposure in internal communications. Employees moved between the two regularly.

As a Burbank Yahoo!, I didn't receive the Peanut Butter Manifesto. I had to read it online. As it turned out, I got a lot more news about Yahoo! online from Valleywag or AlleyInsider. Sometimes they knew more than we did in Burbank.

The inequities between Yahoo! Search Marketing and the Sunnyvale headquarters were most obvious when Yahoo! celebrated its tenth anniversary in 2005. Granted we were only a major part of the company making the most money and had only been bought in 2003, but what we saw on the Intranet Web site, Backyard, was depressing.

Yahoo!s in Sunnyvale were told to leave their desks to attend a concert. Although our earnings funded their party, we were also told to leave our desks — for our afternoon break to stand in line for a piece of cake and fried potato balls (that people originally thought were donuts). Sunnyvale knew what was going on. They sent reps down to oversee and, later, to defend the choice of fried potato balls.

We saw Yahoo!s in Australia taking a harbor cruise, but only on our own time since we had to get back to work and no exception was given for that day on our productivity.

When Yahoo! decided to go green and formed a Green Team, Sunnyvale got movie screenings, including a preview screening of Leonardo DiCaprio's 11th Hour. We were apparently too close to Hollywood to have private screenings or get invited to press screenings (which are free).

Sunnyvale had electrical outlets for employees who owned electric vehicles. I asked to plug in mine in 2005 and even a year after our move to Burbank, I had still not received an answer.

I can't help but wonder how Yahoo! is treating its employees in India, where some of the Yahoo! Search Marketing work had been outsourced. Do you think the laws governing workers comp and ergonomics are as progressive as those here?

Act as One Yahoo! was a motto that did not apply to how Yahoo!s were treated, even in the same state, but only to how Yahoo!s were expected to act despite the inequities.

So no matter how fast we raced and got things out, how we might be crippling our limbs like over-raced geldings on the racetracks of California, we couldn’t expect Yahoo! to support us when we faltered. All for Yahoo!, but Yahoo! for Yahoo!

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