When you think open-source, Yahoo's probably not the first company that pops to mind.
But that's effectively the route Yahoo's taken in partially opening its search network to third-party developers, à la Facebook or Apple's iPhone. The initiative, which it calls Build Your Own Search, or BOSS, is an attempt to demonstrate thought leadership and new sources of revenue. (Not to nitpick, but maybe some crafty developer could get them started with an acronym spellcheck function.)
Yahoo's entering a crowded market for enterprise search. Vendors like Autonomy, FAST (acquired by Microsoft in January), and Google (naturally) have been slugging it out for a couple years now in a nascent market already valued at more than $1.4 billion.
The cynical among you will be quick to point out that Yahoo's doing this to:
- Make itself more attractive to Microsoft again
- Contradict Carl Icahn's charges of incompetence and lack of innovation
- Distract investors from the nasty reality of today's market and a lumbering share price
And all that may be true. But it's also true that Yahoo's making an actual overture to enterprise buyers, in a part of the data management market that's active and bearing fruit for suppliers. What Yahoo really needs, as multiple analysts have pointed out, is a high-profile partner to help with this BOSS effort and to stem erosion of Yahoo's market share in the search space.
The dynamics at work here -- a well-funded company with good brand recognition struggles to assert itself in an online market that should be a slamdunk -- mirror Microsoft's issues almost exactly. And that would seem to build the case for Microsoft acquiring Yahoo. But a budding area of the enterprise search market that rides the coattails of open source is not enough to justify a $30+ billion expenditure. More likely, BOSS is a minor skirmish in what's looking to be a very protracted and messy acquisition battle that will only benefit third parties like Icahn.
— Terry Sweeney, Editor in Chief, Internet Evolution
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