On Saturday November 29th, I reported on my blog the Microsoft Yahoo talks were back on.  I am sure this will go back and forth for a while. Its does not surprise me that Microsoft has tapped a senior executive from Yahoo for such a key position at Microsoft. Yahoo better be careful, Microsoft might go forward without them, and do it all themselves. As a Yahoo shareholder I would hate to see that happen.

Here is a copy of the Microsoft Press Release:

Microsoft Appoints Dr. Qi Lu to Run Online Services Group

Yahoo! veteran to oversee Internet offerings for consumers, advertisers and publishers.

REDMOND, Wash. — Dec. 4, 2008 — Microsoft Corp. today announced that Dr. Qi Lu will join the company as president of the Online Services Group. Dr. Lu will lead Microsoft’s efforts in search and online advertising and all the company’s online information and communications services. Dr. Lu will report to Microsoft Chief Executive Officer Steve Ballmer.

Lu, 47, most recently served as executive vice president of Engineering for the Search and Advertising Technology Group at Yahoo!, where he was responsible for development efforts around Yahoo!’s Web search and monetization platforms. Dr. Lu left Yahoo! in August 2008 after 10 years of service.

“I am tremendously excited to welcome Qi to Microsoft,” Ballmer said. “Dr. Lu’s deep technical expertise, leadership capabilities and hard-working mentality are well-known in the technology industry, and Microsoft will benefit from his addition to our executive management team.”

“I am genuinely excited about the opportunities ahead for Microsoft to make an enormous impact on the online industry,” Dr. Lu said. “Microsoft has built a great foundation for its search and advertising technologies and put an amazing team of researchers and engineers in place to drive the next wave of innovation in online services. I’m looking forward to working with them to help transform the way people and businesses use the Internet to find and share information.”

Before his most recent role at Yahoo!, Lu was vice president of engineering responsible for the technology development of Yahoo!’s Search and Marketplace business unit, which includes the company’s search, e-commerce, and local listings of businesses and products.

Before joining Yahoo! in 1998, Dr. Lu was a Research Staff Member at IBM Almaden Research Center. Before IBM, Dr. Lu worked at Carnegie Mellon University as a Research Associate, and at Fudan University in China as a faculty member. Dr. Lu holds 20 U.S. patents, and received his bachelor of science and master of science in computer science from Fudan University and his Ph.D. in computer science from Carnegie Mellon University.

Lu’s first day at Microsoft will be Jan. 5, 2009. In his role running the Online Services Group, he will oversee several groups including the Advertiser & Publisher Solutions business, managed by Scott Howe who was promoted to corporate vice president; the Online Audience business, managed by Senior Vice President Yusuf Mehdi; OSG Research & Development, managed by Senior Vice President Satya Nadella; and OSG Finance, managed by Rik van der Kooi who was promoted to corporate vice president.

With the successful integration of aQuantive now complete, Brian McAndrews, former CEO of aQuantive and senior vice president of Microsoft’s Advertiser & Publisher Solutions Group, has decided to transition out of Microsoft, and will do so over the next several months, serving in a consultative capacity to Steve Ballmer and Qi Lu during that time.

“Brian McAndrews built a world-class business for advertisers and publishers and led the successful integration of aQuantive into Microsoft, setting the foundation for our next phase of growth,” Ballmer said. “While I am sorry to see Brian leave the company, I respect and understand his decision and wish him nothing but the best in the future.”

“I also want to congratulate Scott and Rik on their well-deserved promotions and look forward to their leadership in the Online Services Group alongside Qi, Yusuf and Satya,” Ballmer said.

As part of today’s announcement, several teams will move to further align resources. The field sales organizations in the Online Services Group will move to Microsoft’s centralized Sales, Marketing and Services Group led by chief operating officer Kevin Turner. This group, called Consumer & Online, will be led by Corporate Vice President Darren Huston and will include the Global Advertising Sales and Services organization, led by vice president Bill Shaughnessy.

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

Note to editors: If you are interested in viewing additional information on Microsoft, please visit the Microsoft Web page at http://www.microsoft.com/presspass on Microsoft’s corporate information pages. Web links, telephone numbers and titles were correct at time of publication, but may since have changed. For additional assistance, journalists and analysts may contact Microsoft’s Rapid Response Team or other appropriate contacts listed at http://www.microsoft.com/presspass/contactpr.mspx.

To go to the original Microsoft Press Release...

Microsoft Appoints Dr. Qi Lu to Run Online Services Group

Fresh Off the Press From Microsoft. December 10th

New President of Online Services Group Sees Chance to Make Impact at Microsoft

Q&A: Qi Lu discusses what attracted him to Microsoft and how he plans to boost the company’s efforts in online search and advertising.

REDMOND, WASH. – Dec. 10, 2008 – On Dec. 4, Microsoft announced Qi Lu had been hired as president of the Online Services Group. Lu will lead Microsoft’s efforts to expand and strengthen its search and online advertising efforts.

Lu comes to Microsoft four months after leaving Yahoo!, where he most recently held the position of executive vice president of Engineering for the Search and Advertising Technology Group. During his 10 years at Yahoo, Lu gained a reputation as top-tier technologist and superb manager. Before joining Yahoo! in 1998, Lu was a Research Staff Member at IBM’s Almaden Research Center. He also has worked at Carnegie Mellon University as a Research Associate and at Fudan University in China as a faculty member. Lu holds 20 U.S. patents, and received his Bachelor of Science and Master of Science in computer science from Fudan University in Shanghai, and his Ph.D. in computer science from Carnegie Mellon University in Pittsburgh, Pa.

PressPass spoke with Lu shortly after the announcement of his new position.

PressPass: Why Microsoft? What was behind your decision to take this new role?

Dr. Qi Lu speaks to Microsoft employees at a Town Hall event on Dec. 8 in Redmond, Wash. Lu will join Microsoft as president of the Online Services Group effective Jan. 5, 2009. Click for high-res version.

Lu: For me, the answer is impact. In my professional career the biggest motivating factor for me is always being in a position to have great impact in what I do. I'm always interested in being in a position or in a place to build the technologies, products or businesses that enable our customers, our users, to be able to do more and be more.

I cannot think of a better platform to have an impact than this position at Microsoft, because we have tremendous opportunities ahead to achieve great impact for our users, our customers and our industry. That's why I'm very excited about this opportunity.

PressPass: When you say you can have an impact through Microsoft, what is it you mean?

Lu: Specifically, it’s the strength of technology and the talent at Microsoft – along with a broad-based online audience, the foundations of its search products and the assets in our advertising platforms. All those things enable our products and our businesses to reach vast numbers of users and customers so we can make a tremendous contribution to our industry as a whole.

PressPass: When you were at Yahoo!, how do you view Microsoft as a competitor?

Lu: I’ve always had a great deal of respect for Microsoft as a company. In my view, Microsoft is one of the most, if not the most, successful companies in terms of value creation, and in terms of producing technology and products that transform society. In my view, Microsoft is a company that really brought computing to every household, and that created a tremendous amount of value to the users and to the overall economy.

As a competitor, you never cut out Microsoft. They keep coming at you. In that way, I’ve always held Microsoft in very high regard.

Also, the people at Microsoft are extraordinary technologists – extremely capable, bright individuals. So, from the standpoint of looking in from the outside, there is tremendous strength in the core talent of Microsoft’s R&D. In my view, this is one of the key foundations of building winning products and winning business in the marketplace.

PressPass: Steve Ballmer recruited you to join Microsoft. How did he make his pitch?

Lu: Steve and I first met last September, in a hotel in San Jose, California. We spent almost half a day talking. We talked about the competitive landscape, about the possibility to really innovate and take the user experience [of Microsoft’s search capabilities] to the next level, and about creating a more competitive space, particularly in the search space. We all believe that it's better for everybody involved when we have a healthy, more competitive environment.

Two things he said really stood out. First was the level of commitment on investment. Steve made it very clear how he views that as critical for the long-term future of Microsoft, and his strong commitment to invest in R&D resources is very, very important to me.

The other thing Steve said that helped convince me this was the right thing for me to do was his commitment to product quality, because you compete in the marketplace on the strength of the product that you bring to the market. You must have a strong commitment to protect the quality of the user experience in the product that you build.

PressPass: When you look broadly at the search space, what sorts of trends do you see playing out over the next year or two?

Lu: There are tremendous opportunities for product innovation, and there are several key forces that are driving us towards that.

One is the advent of more powerful computing infrastructures, [such as] cloud computing infrastructures that enable R&D teams to go through a vast amount of data and find and fix problems very, very quickly. This enables teams to improve the product quality at a much faster rate, and also will help us better understand user intent when they do a search. And the more we understand user intent, the more we can present better search results and an overall search experience that is dramatically improved from where we are today, whether it's through better completion of a particular task or the discovery of very useful and interesting information.

Another trend is the Web as a platform for publishing all sorts of content. There is more and more rich and fresh content, and more engaging social content. So, there is a lot more material to work with. If we're able to understand user intent better, and combine that with the richer content available out there, we will be able to produce a very engaging search experience.

PressPass: Where do you see the opportunities for Microsoft in the search and online space?

Lu: First, I think there is a genuine opportunity to take our search products to the next level. I see that Microsoft's search product quality is improving at a very, very fast rate, that there are great foundations there. And with the technology base, the talent base, the computing infrastructures, I'm confident that we will be in a position to produce a differentiated and compelling search experience.

The second opportunity is to continue building a very powerful advertising platform. Microsoft has made a series of strategic acquisitions, and also built a bunch of internal technologies and products. The key is to put all those assets together to build powerful, highly scalable advertising platforms. The advertising we see today will be very different in the future because of new platforms for it. Ads will be truly relevant and useful, and the experience will be compelling.

PressPass: Whenever anyone talks about competition in search, the target always is Google. Are they catchable?

Lu: Well, we're here to win, and my view on this is that to win in the search space, fundamentally you build on the strengths of your product. And we know what it takes to build a compelling user experience and winning product, which is to have a powerful infrastructure, great talent and put great processes in place so that we can out-develop, out-market, out-innovate our competitors.

But make no mistake; I think Google is a very, very powerful company. They are definitely ahead in the search space. There are a lot of challenges ahead. We've got our work cut out for us.

PressPass: You begin your new job January 5. What will be your first priority?

Lu: I would say hit the gym first. That's actually literally what I do first. Usually I get up reasonably early and try to hit the gym.

But seriously, I'm very much looking forward to hit the ground running. I will try to meet with lots of people, teams, individuals, and work very closely with my directs, my staff and their direct staff to try to get up to speed as fast as I can. I want to make sure the whole organization is very clear on what we are trying to hit, and is energized about our mission and our goals. We have a clear path from where we are today, to where we need to be, and to reach that next level we need to keep executing and building winning products.

Posted Michael Corey,

Founder & CEO, Ntirety

www.ntirety.com

Now that Jerry Yang is out of the way, I am not surprised to see this happening. When you consider the fact that Yahoo stock was down as low as $9.00 a share. Here is a portion of the Times Online article....

Microsoft in $20bn Yahoo deal

Internet advertising is a big deal in todays world. This pending deal will effect all of us. I came across this and thought I would share it will everyone...

Myth-busting and the Yahoo!-Google agreement

Posted September 26th, 2008 at 12:23 pm by Sue Decker, President

There’s been a lot of speculation swirling around about the Yahoo!-Google agreement. We hear everything from the claim that Yahoo! and Google will be fixing prices to the prediction that the agreement is a death sentence for Yahoo!’s sponsored search business. Since the critics clearly don’t understand the deal and what it means for Yahoo!, Google, advertisers, and users, it’s time for some myth-busting.

Here’s the bottom line:

• Yahoo! will use this agreement to help us become a stronger competitor in all aspects of online advertising; and
• Yahoo! is not exiting the sponsored search business. We plan to remain a strong player in sponsored search.

What is the agreement?

You may have heard that the agreement gives Google control over 90% of search advertising. That’s just plain wrong. It’s simply a contract that gives Yahoo! the right, but no obligation, to show Google AdSense ads on Yahoo!’s own network. It’s important to note that the agreement is non-exclusive and gives us the option to “backfill” with Google ads if and when we see fit. The reason we structured the deal this way – rather than a more typical exclusive deal with revenue commitments to us and traffic commitments to Google – was precisely to avoid the issues the critics are raising.

Since Yahoo! bought Overture three years ago, we’ve run that business as a closed system. For example, if you want to put a sponsored search ad on a Yahoo! search results page (“SRP”), you have to buy the ad from us. Right now, that’s the only way to access the millions of online customers who visit the Yahoo! network at the key moment when they express their interests by making a search query. Given the size of our user base and the extraordinary diversity of searches they generate, we cannot, by ourselves, provide relevant paid search ads for every search – we can’t “fill up” all of our SRPs.

In fact, no one company can fill them up – not even Google. Yes, you read that right. There are millions of unique queries, like “elevation of Mount Elbert” and many of them are never matched to a relevant sponsored search ad. These “uncovered” queries are missed opportunities for advertisers to directly engage with consumers and for consumers to benefit from relevant offers. Fortunately, Yahoo! has strong “coverage” and “depth” for many queries – meaning we have a good number of ads to display for many searches. However, coverage and depth are not equal for all categories in our marketplaces. One of our key goals is to unlock the huge value of the hundreds of thousands of less popular queries that don’t show ads Yahoo! today.

The “monetization gap” between Google and Yahoo! is in reality a value gap. Where Google is getting higher bids than Yahoo! today, this is because advertisers perceive that Google is delivering more value – more targeted leads, more clicks, and more conversions. That’s why an advertiser might be willing to bid more for a click on Google than for a click on Yahoo! – the belief that the advertiser will get more value from Google. Google is not setting prices. Advertisers determine how to value keywords. Yahoo! is committed to providing advertisers with greater value and consumers with more relevant offers and this agreement helps us meet this challenge more quickly.

Increasing advertiser value is a complicated endeavor. Part of it is technological –- for example, building better matching algorithms. Part of it is giving advertisers more control over their advertising campaigns. But we also want to increase revenue by building query share, which takes time.

In the past year, we have thought about these challenges very carefully and we created a strategy that we’re convinced is a “win win” for Yahoo! and advertisers. The core idea is limited use of Google ads to deliver more value from our SRPs and other inventory in circumstances where we aren’t delivering the best advertiser value today, and then to use resources gained by that strategy to accelerate our investments in the technologies and marketplaces of the future. That’s where the agreement comes in — it allows us to provide better, more valuable connections immediately.

Current thoughts on implementation

We will implement the agreement in a way that respects an important principle you may know as the Hippocratic Oath: “first, do no harm.” That is, we will not use Google ads in a manner that would create a significant risk to the health of our own sponsored search business.

It’s important for us to recognize when using Google ads is beneficial for users and advertisers. Queries for which we have no coverage, low depth, and/or low relative monetization are all circumstances in which backfilling probably makes sense -– they indicate that Yahoo! is not currently delivering enough value for that inventory. If Google can deliver that value where we currently don’t, then everyone wins -– including the advertiser and the consumer.

It’s equally important for us to protect the long-term health of our marketplaces. As we studied this issue, we became acutely aware that our value proposition depends on having an active, “liquid” marketplace of search terms. The good news? Yahoo! has that for the more popular and commercial queries –- the ones that produce over two-thirds of Yahoo!’s search revenues. This is often not the case, however, for less popular “tail” queries.

As we proceed, we’ll hold true to our goal of making Yahoo! a “must buy” for online advertisers. We have no intention of abandoning our key advertiser relationships. To the contrary, we are exploring ways to further strengthen those relationships, and one of the ways we will do that is through our recently announced Digital Advisory Council. We are asking industry executives from our agency and advertiser partners to join us as we explore the continued evolution of digital media and online advertising. We’re going to start by addressing the confusion and misinformation that currently exists in the market regarding Yahoo!’s agreement with Google, which is a hotly debated topic that needs some much-needed clarification.

I’ve said in the past that we’ll backfill where the monetization gap between Yahoo! and Google is the greatest. This gap is the greatest in areas in which we don’t have matches of offers with very specific queries or where our matches are narrow or not relevant. This should only enhance our relevance to consumers and bring new advertisers to our inventory that didn’t do business with us or that made only limited commitments. Our overriding principle to backfill will be those win-win opportunities to backfill our inventory with advertising that clients find valuable but to which they have had scarce access and in other ways that both optimize for user experience and the maintenance of a robust marketplace.

Finally, let me be absolutely clear that we are not in any way going to be coordinating or setting search term pricing with Google. The fact is that advertisers set prices by bidding in our real time auctions. This agreement gives advertisers a new opportunity to bid for placement on an additional network that includes Yahoo! inventory. They will bid for what they think this opportunity is worth at prices that produce positive ROI. That’s how pricing works today in this industry and this agreement won’t change that.

I hope readers of this post, as well as advertisers and regulators, can move past the false rhetoric being peddled by some of our competitors and see the marvelous potential that the agreement offers the marketplace. It’s a great opportunity for Yahoo!, and we’re committed to implementing it in a way that produces the most value for advertisers and users. Ultimately, that’s the only way we can provide value for Yahoo!’s stockholders.

Sue Decker
President

To link back to the original blog entry....

Susan Decker Yahoo President Speaks Out on Google Deal

Posted by Michael Corey

www.ntirety.com

The combination of Google and Yahoo joining forces spells nothing but bad news for business. This recent article in TECHCRUNCH by Michael Arrington does an excellent job of spelling out why.....

by Michael Arrington on September 21, 2008

 

Randall Stross at The New York Times goes to bat for the Google/Yahoo search marketing deal, saying there’s “nothing to fear” from the two companies linking their search products. I believe most of his analysis is wrong, and he also skips the publisher side of the market entirely. In short, I feel that he is exactly wrong in both his approach and his conclusions.

He begins with “GOOGLE controls about 70 percent of the search advertising market. Doesn’t that give it a monopolist’s ability to set prices as high as it wishes?”

Well no actually, a monopoly controls only the supply side of a transaction, so it can’t change whatever it wants. If prices go too high, users stop buying (this is known as demand elasticity). Being a monopoly just gives you the ability to charge much higher prices than you otherwise would be able to because you don’t have a competitor who can undercut you for less profit.

But Stross skips that analysis and jumps into the meat of his argument. Ad rates are set by auctions, not dictated by Google, he says, so Google has no control over the pricing of those ads. If ad rates go up, it is just the market doing its thing.

This is the focus of his article - saying that there may not be any ad rate increases (which is absurd on its face), and alternately saying that if the rates increase it is simply the market responding to more robust ad auctions.

At the end of the day, advertisers will pay only what they want to get the ads they need. Most advertisers closely track ad performance to return on investment. If bids go up, they step back.

The real long term win for the networks is to build a commercial relationship directly with advertisers. Google has far more of them, because they’re chasing the massive search page views that Google supplies them. The more advertisers bidding, the higher the price.

With the addition of Yahoo search queries, there will be even more inventory, and even more incentive for those advertisers to jump on the Google platform.

So one centralized marketplace equals the highest economic rent to Google, which they can then share with third parties.

There is more to this article, click here.....

Why the Google Yahoo Ad Deal is something to fear

I want to ad a few more thoughts here. These companies are doing this for there own self interest. It will help them charge more for the same ADs they currently deliver. When I see the arguments talking about how they dont set the price, the consumer does. Give it a break. If the consumer controls the price, then lets bring back the 10 cent ad price. If I remember right, google did away with that. 

Give it a break, this is not good for the consumer.

Lets imagine how this happened....

 

Google talking.. "Hey Yahoo, lets merge forces and help the consumer, what do you think?"

Yahoo talking.. "Thats a great idea, I wish I thought of it ! ! ! !"

 

Posted by Michael Corey

www.ntirety.com

 

I just saw this online. Its from  Michael Arrington at Techcrunch. I have included a section of this article. 

We’ve got multiple sources at both Yahoo and Microsoft telling us that official talks are back on between the two companies. But we’re hearing something different than CNET - the talks are about a full buyout again, not a sweetened search-only deal.

The information we have is thin, but what one source is saying that Microsoft is talking a price lower than the $33 they were offering when the talks disintegrated in May. Given Yahoo’s recent share price (it’s below $21 today), and the fact that just about everyone other than their board and top execs are publicly screaming for a deal, I’m not surprised.

Microsoft official comment is “no comment,” which actually contains more information than it appears to. For well over a month, Microsoft has officially been saying they’re no longer interested in Yahoo. They didn’t say that today.

To read the full article click here. 

http://www.techcrunch.com/2008/06/24/sources-microsoft-and-yahoo-talks-back-on/ 

Anything that can challange google is important to the future of Information Technology I am a big fan of Yahoo. I use the site quite a bit, especially yahoo messenger. I have a number of friends around the world I keep in touch with. 

Posted by Michael Corey

www.ntirety.com

I saw a blog entry the piqued my interest.  It was titled “IBM, Microsoft & Google Eras of Computing” by Sridhar. It was posted may 2, 2008. I will have a link to it later in this article. The opening paragraph reads like this….

“By now it is conventional wisdom to say that there was an IBM Era of computing, then a Microsoft Era, and now we are in the Google Era. In this post, I will explain why Microsoft was not the “next IBM” and why Google is not the “next Microsoft” - there are significant qualitative differences among them, quite apart from their status as the dominant, era-defining players. Understanding that qualitative difference is crucial for third party vendors  like Zoho to thrive.”

I like this article because it makes you think. When I started my blog on remote database administration, I started to write entries like 7 deadly sins of database administration. What I realized quickly, yes I could write articles such as that and I will continue to do. I also want to draw into my Blog industry trends that are affecting us and along the way some fun items.

Database administration, as we know it is changing. That it’s important that we recognize that its changing and make good career decisions and good business decisions based on how it’s changing for ourselves and our business. I believe that Remote database administration is here to stay. That its part of an overall business strategy companies need to adopt to deal with the challenges surrounding database administration and more importantly help a company say more competitive in todays Internet enabled world that runs 7X24.

I would argue that software, as a service is here to stay. This blog that talks about the IBM era of computing, the Microsoft Era of computing and now the Google era of computing is worth reading. I am not sure I am ready to give up on Microsoft just yet. The article brings up some interesting thoughts. Given  that Microsoft just walked away from Yahoo makes this article very timely.

In this article he defines the IBM Era as…

“The original IBM mainframe era (in contrast to today’s IBM) was one of highly closed systems. IBM was not just the dominant player of the era, IBM was pretty much the entire ecosystem. There just wasn’t a lot of room for third parties to play in.”

He then goes on the define the Microsoft Era as….

“In contrast to IBM, Microsoft was far more open, which indeed was the original reason for their success. Microsoft unleashed what I would call the semi-open era of computing. The acronym ISV (independent software vendor) came into its own during the Microsoft era. Indeed, Microsoft encouraged ISVs, provided fairly good support - up to a point.”

He defines the Google Era as…..

“Now the present Google era. Google has the genetic and cultural advantage of being born in an open source world, with a business model that is aligned with rather than antagonistic to open source. It reflects in how they conduct their ecosystem initiatives. Google Gears comes with one of the most liberal open source licenses (BSD license)…”

To read the the article “IBM, Microsoft, Google Eras of Computing” by Sridhar click here

Posted by Michael Corey

www.ntirety.com