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Brier Dudley's Blog

Brier Dudley offers a critical look at technology and business issues affecting the Northwest.

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June 12, 2008 3:55 PM

Yahoo lets Google handle ads, replaying the fate of newspapers?

Posted by Brier Dudley

Are the Internet giants going the way of newspapers in the 1970s and 1980s, when papers started consolidating and signing joint-operating agreements to sustain themselves?

The Yahoo-Google deal sounds like a step toward a JOA, a federally approved agreement like the one between The Seattle Times and the P-I.

This is a gross simplification, but in these cases the stronger entity takes over business operations for a weaker partner, which continues to produce a separate editorial product.

Lawyers had the upper hand writing the Yahoo+Google announcement about a partnership, but basically Google's going to start handling ads that appear on Yahoo's pages -- just as The Times sells and places the ads that appear on the P-I's pages.

But Yahoo didn't go all the way. It's still going to handle some ads. Yahoo's also going to decide which search terms and pages are handled by Google's ad machine, and which ones are handled by Yahoo's relatively new "Panama" ad system.

That may stave off antitrust regulators (although the Senate's antitrust subcommittee chairman, Herb Kohl, D-Wis., is already vowing to "closely examine" the deal) and preserve some of Yahoo's dignity, but it will probably also confuse the heck out of advertisers. Will they bother to sort out which ad system is placing their ads where, or will they simply migrate to Google, thinking that will get their ads distributed onto both Google and Yahoo networks? Until they get a clear message about what's happening, it undermines the alleged simplicity and precision of their ads.

If this torpedos Yahoo's Panama, will Google take over the rest of Yahoo's ads?

Yahoo expects the deal will increase its cash flow by roughly $20 million to $40 million a month in the first year. Had it peaked otherwise? Will this cover up whether Google's search business is starting to peak as well?

I'll bet Microsoft senses that peak. That's probably why it's no longer offering top dollar for Yahoo and willing to watch and wait for Yahoo's value to fall, before pouncing again.

Consolidations and JOAs preceded the decline of newspapers' grand monopoly. It's not much consolation to papers, but the Yahoo deal suggests that the Internet giants steamrolling them aren't all invincible.

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June 12, 2008 1:46 PM

Shakeup in Microsoft games group: Shane Kim replaced by Phil Spencer

Posted by Brier Dudley

Did Microsoft use the Yahoo storm as cover for its announcement of a big reorganization in its games group?

The company announced studio boss Shane Kim is moving into a strategy and business development position, a new VP position in the Interactive Entertainment Business. The release said: "His focus will be on future external relationships and partnerships, as well as developing growth strategies for the entire business."

Taking his place at the studio helm is Phil Spencer, formerly general manager of Microsoft Games Studios Europe. Spencer will relocate to Redmond from U.K. for the position leading all of Microsoft's first-party development and publishing efforts.

Also leaving is Jeff Bell, the group's vice president for global marketing. He "has decided to pursue other opportunities outside Microsoft," according to the release. But Bell will stay through the summer to work through the transition. Filling in will be Matt Barlow, Charlotte Stuyvenberg and Jim Merrick from the marketing and communication teams.

Now all they need to do is start making more first-party games.

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June 12, 2008 1:11 PM

Yahoo says it's over, Microsoft still playing, time for a break

Posted by Brier Dudley

Time for a summer vacation, or a cooling off period, in the Yahoo-Microsoft drama.

Either way, I don't think it's as final as Yahoo is trying to make it sound with its announcement this afternoon that "discussions with Microsoft regarding a potential transaction -- whether for an acquisition of all of Yahoo! or a partial acquisition -- have concluded."

Continue reading this post ...


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June 12, 2008 10:36 AM

Investors double down on WidgetBucks' ad tech

Posted by Brier Dudley

I still like Mpire's comparison shopping site, even if it doesn't give money back like Microsoft's new Live shopping service.

But with its second round of investment announced today - $10 million from DFJ and Ignition, matching the $10 million it received earlier from Ignition - the nearly three-year-old Seattle startup seems to be completing its transformation into an advertising network and services provider.

Continue reading this post ...


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Gadgets and games | Fun stuff I've written about lately includes Apple's iPhone, Hewlett-Packard's HDX laptop and Microsoft's Halo3. Also on the radar are new digital video boxes such as the Tivo HD and the Vudu.