MySpace Music is getting closer to finally finding a CEO.
Peter Kafka at the blog All Things Digital is reporting that negotiations between MySpace Music and Courtney Holt, an MTV executive, are all but finished. Kafka writes: "At this point there doesn't seem to be anything left beyond 'i'-dotting and 't'-crossing."
Last week, we reported that MySpace Music offered Holt the vacant CEO job. On Tuesday, I reported that Owen Van Natta was a top candidate until bowing out relatively late in the process.
The newly launched music service is hosting a party in San Francisco on Thursday. Will this be Holt's coming-out party?
Thursday, November 6, 2008
IBM has tech answer for woes of economy
IBM's chief executive, Sam Palmisano, is proposing a technology-fueled economic recovery plan that calls for public and private investment in more efficient systems for utility grids, traffic management, food distribution, water conservation and health care.
Recent technology advances make this possible, and the need is apparent, Palmisano will say in a speech he is scheduled to deliver Thursday to the Council on Foreign Relations in New York. Sixty-seven percent of electrical energy, for example, is lost because of inefficient power generation and grid management. Congested highways cost $78 billion a year in squandered working hours and gas burned.
Palmisano's speech never mentions IBM, but his proposal has a self-serving side. IBM is increasingly playing the role of lead contractor in these so-called smart infrastructure projects around the world, from a traffic management network in Stockholm to electric grids in Texas.
Some economists and policy experts say similar projects are a good way to improve the long-term health of the economy, potentially providing a foundation for innovation and growth across a range of industries.
Recent technology advances make this possible, and the need is apparent, Palmisano will say in a speech he is scheduled to deliver Thursday to the Council on Foreign Relations in New York. Sixty-seven percent of electrical energy, for example, is lost because of inefficient power generation and grid management. Congested highways cost $78 billion a year in squandered working hours and gas burned.
Palmisano's speech never mentions IBM, but his proposal has a self-serving side. IBM is increasingly playing the role of lead contractor in these so-called smart infrastructure projects around the world, from a traffic management network in Stockholm to electric grids in Texas.
Some economists and policy experts say similar projects are a good way to improve the long-term health of the economy, potentially providing a foundation for innovation and growth across a range of industries.
What Obama presidency means for clean tech
Energy and environmental policy is poised for dramatic change under an Obama administration even with a slumping economy.
With the incoming administration and Congress, renewable energy advocates and environmentalists said they anticipate a comprehensive national energy plan focused on fostering clean-energy technologies.
"The election is over. Now the hard work begins," wrote Dan Farber, a professor of law at the University of California at Berkeley and a member of the lobbying group Cleantech & Green Business for Obama. "Change is on the way."
Obama's energy plan, detailed fully earlier this year, is ambitious. It calls for a $150 billion investment in clean technologies over 10 years, aggressive targets for greenhouse emission reductions, and programs to promote energy efficiency, low-carbon biofuels, and renewable energies.
But a troubled economy--among other barriers--means that bold, new energy legislation, notably caps on greenhouse gas emissions, is unlikely to pass in the first years of an Obama administration, according to experts.
Instead, the Obama presidency is expected to first push for smaller yet significant measures, such as efficiency and renewable energy mandates, and then lay the groundwork for far-reaching climate initiatives, they said.
"One of the biggest setbacks is trying to find the money to pay for all of this. This isn't free," said David Kurzman, managing director of Kurzman CleanTech Research. "Reality will set in and trying to find money...is really going to temper the possibilities over the next 12 months."
Winners and losers Clean-tech company executives note that during the campaign, Obama articulated his belief that environmental protection and economic development can be closely related. During Obama's acceptance speech Tuesday night, his reference to "new energy to harness and new jobs to be created" could be read in two ways--a call for political involvement or for alternative-energy sources.
In an interview with Time magazine late last month, he said, "From a purely economic perspective, finding the new driver of our economy is going to be critical. There is no better potential driver that pervades all aspects of our economy than a new energy economy."
Clean-tech professionals expect that energy and the environment, which were hot-button issues during the campaign, to continue to command the attention of politicians and the electorate. And the combination of a Democratic-controlled Congress and Obama administration means that government stimulus spending targeted at the energy business is a strong possibility.
"There's a growing sense that investing in infrastructure, even if it means more deficit spending, is a good thing because it will help economic growth in the short and long term," said Ethan Zindler of research firm New Energy Finance. "And green energy has come to be regarded as a 21st-century infrastructure play."
Clean tech under ObamaPresident-elect Barack Obama has advocated investing in clean energy to create "green jobs." Here are some possible policy changes.
An investment in upgrading the power grid which would make it easier to use solar and wind.
A national renewable portfolio standard that mandates utilities get 10 percent of electricity from solar, wind, or geothermal by 2012.
Continued support for biofuels and introduction of low-carbon fuel standard.
Increased vehicle fuel-efficiency standards and tax rebates for plug-in hybrids.
Incentives for smart grid products like advanced meters.
A carbon cap-and-trade regime meant to make low-carbon technologies more price competitive.
Research on so-called clean coal technologies to store carbon dioxide emissions underground.
Source: CNET reporting, BarackObama.com
Some technologies stand to benefit more than others if Obama's administration is successful in implementing its proposals.
Renewable energies. Obama has called for a national renewable portfolio standard to mandate that utilities get 10 percent of electricity from renewable sources--wind, solar, and geothermal--by 2012, and 25 percent by 2025. "That's the backbone the country needs to invest in," said Rhone Resch, president of the Solar Energy Industry Association.
Although more than half the states already have renewable portfolio standards, many southern states have balked at national standards because they say they do not have sufficient renewable energy resources.
In this case, having an activist federal government, as Obama's proposals suggest, may meet resistance from the states because electric utilities are regulated by a mix state and federal agencies. "It's not just a question of money. It's also a question of governance and public policy," said Jim Owen, a representative for the Edison Electrical Institute.
In the recently passed financial bailout package, solar energy received an eight-year extension of federal tax credits, while wind received only a one-year extension. The election increases the chances that wind energy will be extended further.
Efficiency and smart grid technology. Obama's plan calls for a power grid modernization program and stricter building efficiency codes in federal buildings. That means efficiency products such as demand response, advanced metering, and sensors to monitor usage should further benefit from government incentives, said Kurzman.
A federal initiative to establish interconnection standards and bulk up interstate transmission lines would make power generation of all kinds more efficient and allow utilities to use more renewable sources. "A 50-state role to transmission just doesn't get the job done. You need a federal planning and facilitation," said Rob Church, vice president of research and industry analysis at the American Council on Renewable Energy (ACORE).
Biofuels. Hailing from the corn-producing state of Illinois, Obama is expected to continue supporting ethanol. However, Brooke Coleman, executive director of the New Fuels Alliance, noted that Obama appears to understand that the biofuels industry needs to transition to nonfood feedstocks, such as wood chips or algae, in order to be sustainable.
Coleman said that strong federal policies are required for biofuels to crack into the fossil fuel industry.
"There is not a free market in the fuel sector. There's no real competition in the wholesale supply chain--it's completely owned by oil," Coleman said. "You have to be pretty heavy-handed to fundamentally correct this market."
Auto. Obama has called for increasing fuel efficiency, tax credits for plug-in hybrid cars, and loan guarantees so that automakers can "retool."
But struggling auto makers--said to be running dangerously low on cash--will need government aid in the coming months to prevent larger harm to the economy, argued David Cole, the chairman for the Center for Automotive Research. For that reason, he expects government leaders of all kinds to be supportive.
"Politically, the issue here is pretty stark and cost of keeping the auto industry in game is whole lot less than of a major failure," Cole said.
Fossil fuels and nuclear. During the campaign, Obama said he would allow increased domestic oil and gas drilling as well as investments in so-called clean coal technology where carbon emissions are stored underground. Companies that have coal gasification technologies stand to benefit because they are cleaner source of electricity, said Kurzman.
In the campaign, Obama voiced caution on storing nuclear waste. But during the second presidential debate, Obama said he backs nuclear power "as one component of our overall energy mix."
Skip Bowman, president of the Nuclear Energy Institute, said Tuesday he expects the new Congress and administration to continue its support of nuclear because it addresses energy and climate change.
Counting carbonLonger term, the broadest policy change on energy and environment will be climate-change regulations. Obama has called for an 80 percent reduction of greenhouse gas emissions from 1990 levels by 2050 through a federal cap-and-trade system. Pollution rights would be auctioned, at least partially, which would create a fund for clean technology programs.
Large polluters, like chemical companies and utilities that rely heavily on coal, are the ones that will be most affected. But given that there is stronger political will to tackle energy security than climate change, policies to promote domestic energy production and efficiency are likely to take precedence over cap and trade, said New Energy Finance's Zindler.
Still, the new administration can accomplish a great deal on renewable energy without having to pass multibillion-dollar legislation, said Scott Sklar, a renewable energy lobbyist and president of the Stella Group. Using only the federal government's purchasing power to integrate green building technologies and addressing grid interconnection issues, for example, can be done without passing laws.
"Existing programs can be tweaked to accommodate the new vision," Sklar said. "Depending on how you structure things, you could have a quick and profound impact on new technologies."
New Fuel Alliance's Coleman said that the biggest danger to the Obama administration and new Congress is not "overplaying their hand" and pushing more extreme environmental policies.
"I firmly believe that the linchpin to this entire game is allowing agriculture to play a role in diversifying our energy, whether it be wind, solar, using rural areas for geothermal or wind corridors," he said. "More extreme positions like trying to end coal result in failure and missed opportunities."
With the incoming administration and Congress, renewable energy advocates and environmentalists said they anticipate a comprehensive national energy plan focused on fostering clean-energy technologies.
"The election is over. Now the hard work begins," wrote Dan Farber, a professor of law at the University of California at Berkeley and a member of the lobbying group Cleantech & Green Business for Obama. "Change is on the way."
Obama's energy plan, detailed fully earlier this year, is ambitious. It calls for a $150 billion investment in clean technologies over 10 years, aggressive targets for greenhouse emission reductions, and programs to promote energy efficiency, low-carbon biofuels, and renewable energies.
But a troubled economy--among other barriers--means that bold, new energy legislation, notably caps on greenhouse gas emissions, is unlikely to pass in the first years of an Obama administration, according to experts.
Instead, the Obama presidency is expected to first push for smaller yet significant measures, such as efficiency and renewable energy mandates, and then lay the groundwork for far-reaching climate initiatives, they said.
"One of the biggest setbacks is trying to find the money to pay for all of this. This isn't free," said David Kurzman, managing director of Kurzman CleanTech Research. "Reality will set in and trying to find money...is really going to temper the possibilities over the next 12 months."
Winners and losers Clean-tech company executives note that during the campaign, Obama articulated his belief that environmental protection and economic development can be closely related. During Obama's acceptance speech Tuesday night, his reference to "new energy to harness and new jobs to be created" could be read in two ways--a call for political involvement or for alternative-energy sources.
In an interview with Time magazine late last month, he said, "From a purely economic perspective, finding the new driver of our economy is going to be critical. There is no better potential driver that pervades all aspects of our economy than a new energy economy."
Clean-tech professionals expect that energy and the environment, which were hot-button issues during the campaign, to continue to command the attention of politicians and the electorate. And the combination of a Democratic-controlled Congress and Obama administration means that government stimulus spending targeted at the energy business is a strong possibility.
"There's a growing sense that investing in infrastructure, even if it means more deficit spending, is a good thing because it will help economic growth in the short and long term," said Ethan Zindler of research firm New Energy Finance. "And green energy has come to be regarded as a 21st-century infrastructure play."
Clean tech under ObamaPresident-elect Barack Obama has advocated investing in clean energy to create "green jobs." Here are some possible policy changes.
An investment in upgrading the power grid which would make it easier to use solar and wind.
A national renewable portfolio standard that mandates utilities get 10 percent of electricity from solar, wind, or geothermal by 2012.
Continued support for biofuels and introduction of low-carbon fuel standard.
Increased vehicle fuel-efficiency standards and tax rebates for plug-in hybrids.
Incentives for smart grid products like advanced meters.
A carbon cap-and-trade regime meant to make low-carbon technologies more price competitive.
Research on so-called clean coal technologies to store carbon dioxide emissions underground.
Source: CNET reporting, BarackObama.com
Some technologies stand to benefit more than others if Obama's administration is successful in implementing its proposals.
Renewable energies. Obama has called for a national renewable portfolio standard to mandate that utilities get 10 percent of electricity from renewable sources--wind, solar, and geothermal--by 2012, and 25 percent by 2025. "That's the backbone the country needs to invest in," said Rhone Resch, president of the Solar Energy Industry Association.
Although more than half the states already have renewable portfolio standards, many southern states have balked at national standards because they say they do not have sufficient renewable energy resources.
In this case, having an activist federal government, as Obama's proposals suggest, may meet resistance from the states because electric utilities are regulated by a mix state and federal agencies. "It's not just a question of money. It's also a question of governance and public policy," said Jim Owen, a representative for the Edison Electrical Institute.
In the recently passed financial bailout package, solar energy received an eight-year extension of federal tax credits, while wind received only a one-year extension. The election increases the chances that wind energy will be extended further.
Efficiency and smart grid technology. Obama's plan calls for a power grid modernization program and stricter building efficiency codes in federal buildings. That means efficiency products such as demand response, advanced metering, and sensors to monitor usage should further benefit from government incentives, said Kurzman.
A federal initiative to establish interconnection standards and bulk up interstate transmission lines would make power generation of all kinds more efficient and allow utilities to use more renewable sources. "A 50-state role to transmission just doesn't get the job done. You need a federal planning and facilitation," said Rob Church, vice president of research and industry analysis at the American Council on Renewable Energy (ACORE).
Biofuels. Hailing from the corn-producing state of Illinois, Obama is expected to continue supporting ethanol. However, Brooke Coleman, executive director of the New Fuels Alliance, noted that Obama appears to understand that the biofuels industry needs to transition to nonfood feedstocks, such as wood chips or algae, in order to be sustainable.
Coleman said that strong federal policies are required for biofuels to crack into the fossil fuel industry.
"There is not a free market in the fuel sector. There's no real competition in the wholesale supply chain--it's completely owned by oil," Coleman said. "You have to be pretty heavy-handed to fundamentally correct this market."
Auto. Obama has called for increasing fuel efficiency, tax credits for plug-in hybrid cars, and loan guarantees so that automakers can "retool."
But struggling auto makers--said to be running dangerously low on cash--will need government aid in the coming months to prevent larger harm to the economy, argued David Cole, the chairman for the Center for Automotive Research. For that reason, he expects government leaders of all kinds to be supportive.
"Politically, the issue here is pretty stark and cost of keeping the auto industry in game is whole lot less than of a major failure," Cole said.
Fossil fuels and nuclear. During the campaign, Obama said he would allow increased domestic oil and gas drilling as well as investments in so-called clean coal technology where carbon emissions are stored underground. Companies that have coal gasification technologies stand to benefit because they are cleaner source of electricity, said Kurzman.
In the campaign, Obama voiced caution on storing nuclear waste. But during the second presidential debate, Obama said he backs nuclear power "as one component of our overall energy mix."
Skip Bowman, president of the Nuclear Energy Institute, said Tuesday he expects the new Congress and administration to continue its support of nuclear because it addresses energy and climate change.
Counting carbonLonger term, the broadest policy change on energy and environment will be climate-change regulations. Obama has called for an 80 percent reduction of greenhouse gas emissions from 1990 levels by 2050 through a federal cap-and-trade system. Pollution rights would be auctioned, at least partially, which would create a fund for clean technology programs.
Large polluters, like chemical companies and utilities that rely heavily on coal, are the ones that will be most affected. But given that there is stronger political will to tackle energy security than climate change, policies to promote domestic energy production and efficiency are likely to take precedence over cap and trade, said New Energy Finance's Zindler.
Still, the new administration can accomplish a great deal on renewable energy without having to pass multibillion-dollar legislation, said Scott Sklar, a renewable energy lobbyist and president of the Stella Group. Using only the federal government's purchasing power to integrate green building technologies and addressing grid interconnection issues, for example, can be done without passing laws.
"Existing programs can be tweaked to accommodate the new vision," Sklar said. "Depending on how you structure things, you could have a quick and profound impact on new technologies."
New Fuel Alliance's Coleman said that the biggest danger to the Obama administration and new Congress is not "overplaying their hand" and pushing more extreme environmental policies.
"I firmly believe that the linchpin to this entire game is allowing agriculture to play a role in diversifying our energy, whether it be wind, solar, using rural areas for geothermal or wind corridors," he said. "More extreme positions like trying to end coal result in failure and missed opportunities."
Web 2.0 Summit: Larry Brilliant on investing in the future
SAN FRANCISCO--"We are at an inflection point where there are enormous problems to be solved and enormous opportunities."
Those weren't the words of President-elect Barack Obama. It was the Pied Piper of Web 2.0, Tim O'Reilly, making his opening remarks at the Web 2.0 Summithere Wednesday.
Against the backdrop of the change in power in Washington, D.C. (opportunities) and the economic meltdown (one of the problems), the navel-gazing tech industry lives on. Speakers at the event include VC legend John Doerr, Yahoo's Jerry Yang, Facebook's Mark Zuckerberg, Alibaba's Jack Ma, Intel's Paul Otellini, Al Gore, and Lance Armstrong. Co-host John Battelle, who is also the CEO of ad network Federated Media, was quick to thank the sponsors who came through with the money, citing the tough climate for advertising.
But the Web 2.0 Summit inaugural session didn't start with talk about Web 2.0 business models, entrepreneurial riches, or surviving the downturn. In the spirit of the new era in American history, philanthropy and investing in a better future were the first topics of discussion.
Google.org Executive Director Dr. Larry Brilliant talked about how his organization put $100 million to work in the past year. Google invests 1 percent of Google's equity and profits (in various forms) and employee time to fund the organization Most recently, Google.org's "Predict and Prevent" initiative gave grants of more than $14 million to support partners working in Southeast Asia and Africa to prevent the next pandemic.
Google.org isn't purely philanthropic in its approach to investing in a better future. The Renewable Energy Cheaper Than Coal initiative, for example, has made $50 million investments in alternative energy companies. "It's different than pick and shovel investments," Brilliant said. "It is important that we make money on these investments and for the companies to make a profit...If they don't make money, no one else will and we won't be able to take advantage of capital flows and market forces."
Google.org has invested more than $10 million in enhanced geothermal energy. "Geothermal, if it works, is better than intermittent producers of solar and wind, and it's also ubiquitous," Brilliant said, noting that he meets with Google founders Sergey Brin and Larry Page every week to discuss Google.org.
Brilliant also touted the virtues of The WELL, which he co-founded in 1985, over the current set of online communications services, such as Twitter and instant messaging. The WELL is structured to support more coherent conversations on important issues, he said. "Coherent" is probably the key word, given the more linear and chronological nature of WELL conversations, but the use of blogs, instant messaging, wikis, and social networks, as well as more traditional forum software helped to catapult Barack Obama from relative obscurity to the White House in two years.
Those weren't the words of President-elect Barack Obama. It was the Pied Piper of Web 2.0, Tim O'Reilly, making his opening remarks at the Web 2.0 Summithere Wednesday.
Against the backdrop of the change in power in Washington, D.C. (opportunities) and the economic meltdown (one of the problems), the navel-gazing tech industry lives on. Speakers at the event include VC legend John Doerr, Yahoo's Jerry Yang, Facebook's Mark Zuckerberg, Alibaba's Jack Ma, Intel's Paul Otellini, Al Gore, and Lance Armstrong. Co-host John Battelle, who is also the CEO of ad network Federated Media, was quick to thank the sponsors who came through with the money, citing the tough climate for advertising.
But the Web 2.0 Summit inaugural session didn't start with talk about Web 2.0 business models, entrepreneurial riches, or surviving the downturn. In the spirit of the new era in American history, philanthropy and investing in a better future were the first topics of discussion.
Google.org Executive Director Dr. Larry Brilliant talked about how his organization put $100 million to work in the past year. Google invests 1 percent of Google's equity and profits (in various forms) and employee time to fund the organization Most recently, Google.org's "Predict and Prevent" initiative gave grants of more than $14 million to support partners working in Southeast Asia and Africa to prevent the next pandemic.
Google.org isn't purely philanthropic in its approach to investing in a better future. The Renewable Energy Cheaper Than Coal initiative, for example, has made $50 million investments in alternative energy companies. "It's different than pick and shovel investments," Brilliant said. "It is important that we make money on these investments and for the companies to make a profit...If they don't make money, no one else will and we won't be able to take advantage of capital flows and market forces."
Google.org has invested more than $10 million in enhanced geothermal energy. "Geothermal, if it works, is better than intermittent producers of solar and wind, and it's also ubiquitous," Brilliant said, noting that he meets with Google founders Sergey Brin and Larry Page every week to discuss Google.org.
Brilliant also touted the virtues of The WELL, which he co-founded in 1985, over the current set of online communications services, such as Twitter and instant messaging. The WELL is structured to support more coherent conversations on important issues, he said. "Coherent" is probably the key word, given the more linear and chronological nature of WELL conversations, but the use of blogs, instant messaging, wikis, and social networks, as well as more traditional forum software helped to catapult Barack Obama from relative obscurity to the White House in two years.
Jerry Yang: I'm a fighter
SAN FRANCISCO--This hasn't been the best year for a lot of people in the tech industry. But nobody can argue that Yahoo CEO Jerry Yang hasn't had a particularly rough time.
"Jerry Yang has had a tough nine months," Web 2.0 Summit host John Battelle of Federated Media said as he introduced the CEO for a talk at the conference here on Wednesday, and went on to list some of his company's much-documented woes. Yang, in a blue blazer and white checkered shirt, slouching a bit in his chair, replied, "That's quite an intro."
But it was still an understatement. Yang took the stage at the high-profile industry conference on the same day that Google announced it was walking away from a 10-year search-advertising deal with Yahoo, which would have brought the beleaguered Sunnyvale, Calif.-based dot-com hundreds of millions of dollars in revenue, due to antitrust concerns. Battelle said that, due to the situation, before the talk started that he'd gotten calls from multiple reporters wondering if Yang would actually show up.
But he did, and he was defiant. "I don't regret any minute of what happened," Yang said. "Because I've been there the whole time, it's a part of me and some people say that's great and some people say 'well, you're just too close to it.'"
Even though Battelle, moderating the "conversation," brought up just about every ghost from Yahoo's recent past--from the "peanut butter memo" to the Microsoft takeover debacle to corporate raider Carl Icahn's attempt to shake things up--the talk proved less than electrifying. The CEO kept driving home a single point: that Yahoo is a growing company and that he fully expects it to weather the storm regardless of the situation.
"I certainly didn't expect the year to be what it's been, coming into it, but I think that the environment which we are in today is extraordinary," Yang said. "I think what Yahoo's been through in 2008 has been extraordinary."
The problem with the Microsoft deal, he said, was that it was the wrong deal for the two companies. "To this day, I have to say that the best thing for Microsoft to do is to buy Yahoo. I don't think that is a bad idea at all...at the right price, whatever the price is, we are willing to sell the company," he explained. "We were ready to negotiate, we wanted to negotiate a deal, and we felt that we weren't that far apart. But at the end of the day, they withdrew and they since have been very clear about not wanting to buy the company."
In a joking reference to the fact that Yahoo may not get within striking distance of the share price Microsoft was willing to buy it for any time soon, Battelle exclaimed, "Why didn't you take the $33 a share, Jerry?" Indeed, some pundits think that Microsoft may show a renewed interest now that Yahoo has been (arguably) sufficiently battered to make it bargain-basement cheap. The catalyst, of course, is the disintegration of the Google deal.
"Google clearly decided that they did not want to stay in the deal, and we're disappointed with that," was Yang's take on it.
He encouraged Battelle--and the audience--to focus on the innovation, not the bad press. Namely, he meant the company's restructuring (or "rewiring," as they seem to prefer) into a developer-friendly open platform. When Battelle asked him if Yahoo was just jumping on the "platform" bandwagon kick-started by Facebook a year and a half ago, Yang replied, "It's very different from Facebook because what people go to Facebook for is very different from why they go to Yahoo."
The other light at the end of the tunnel, as detailed by Yang, is APT, the upcoming advertising product that's such a big deal for the company that they enlisted Mad Men star Jon Hamm, who plays a fictional advertising exec on TV, to help them pitch the product.
"I think that advertising is still fairly early in its development on the Internet, and I know it's a $40 billion industry and everyone talks about it as a large mature industry," Yang said. "But our view has been that the real sort of endpoint for advertising, the real vision for advertising is being able to really take advertisers and advertising offers and being able to map them against consumer needs, consumer desires in a way that is seamless, sort of one big marketplace."
Though he remained characteristically quiet and soft-spoken, Yang made it clear that he, along with the rest of Yahoo, wants to be seen as a fighter.
"The Yahoo story that hasn't really been told, and what we've had to execute in order to do it, is we do believe we're innovating, we do believe we're changing, we do believe we're changing the game," Yang said. "My personal belief is if you're not in the game to win, you shouldn't be in the game, and that's the way that I try to encourage the whole company to think about."
"Jerry Yang has had a tough nine months," Web 2.0 Summit host John Battelle of Federated Media said as he introduced the CEO for a talk at the conference here on Wednesday, and went on to list some of his company's much-documented woes. Yang, in a blue blazer and white checkered shirt, slouching a bit in his chair, replied, "That's quite an intro."
But it was still an understatement. Yang took the stage at the high-profile industry conference on the same day that Google announced it was walking away from a 10-year search-advertising deal with Yahoo, which would have brought the beleaguered Sunnyvale, Calif.-based dot-com hundreds of millions of dollars in revenue, due to antitrust concerns. Battelle said that, due to the situation, before the talk started that he'd gotten calls from multiple reporters wondering if Yang would actually show up.
But he did, and he was defiant. "I don't regret any minute of what happened," Yang said. "Because I've been there the whole time, it's a part of me and some people say that's great and some people say 'well, you're just too close to it.'"
Even though Battelle, moderating the "conversation," brought up just about every ghost from Yahoo's recent past--from the "peanut butter memo" to the Microsoft takeover debacle to corporate raider Carl Icahn's attempt to shake things up--the talk proved less than electrifying. The CEO kept driving home a single point: that Yahoo is a growing company and that he fully expects it to weather the storm regardless of the situation.
"I certainly didn't expect the year to be what it's been, coming into it, but I think that the environment which we are in today is extraordinary," Yang said. "I think what Yahoo's been through in 2008 has been extraordinary."
The problem with the Microsoft deal, he said, was that it was the wrong deal for the two companies. "To this day, I have to say that the best thing for Microsoft to do is to buy Yahoo. I don't think that is a bad idea at all...at the right price, whatever the price is, we are willing to sell the company," he explained. "We were ready to negotiate, we wanted to negotiate a deal, and we felt that we weren't that far apart. But at the end of the day, they withdrew and they since have been very clear about not wanting to buy the company."
In a joking reference to the fact that Yahoo may not get within striking distance of the share price Microsoft was willing to buy it for any time soon, Battelle exclaimed, "Why didn't you take the $33 a share, Jerry?" Indeed, some pundits think that Microsoft may show a renewed interest now that Yahoo has been (arguably) sufficiently battered to make it bargain-basement cheap. The catalyst, of course, is the disintegration of the Google deal.
"Google clearly decided that they did not want to stay in the deal, and we're disappointed with that," was Yang's take on it.
He encouraged Battelle--and the audience--to focus on the innovation, not the bad press. Namely, he meant the company's restructuring (or "rewiring," as they seem to prefer) into a developer-friendly open platform. When Battelle asked him if Yahoo was just jumping on the "platform" bandwagon kick-started by Facebook a year and a half ago, Yang replied, "It's very different from Facebook because what people go to Facebook for is very different from why they go to Yahoo."
The other light at the end of the tunnel, as detailed by Yang, is APT, the upcoming advertising product that's such a big deal for the company that they enlisted Mad Men star Jon Hamm, who plays a fictional advertising exec on TV, to help them pitch the product.
"I think that advertising is still fairly early in its development on the Internet, and I know it's a $40 billion industry and everyone talks about it as a large mature industry," Yang said. "But our view has been that the real sort of endpoint for advertising, the real vision for advertising is being able to really take advertisers and advertising offers and being able to map them against consumer needs, consumer desires in a way that is seamless, sort of one big marketplace."
Though he remained characteristically quiet and soft-spoken, Yang made it clear that he, along with the rest of Yahoo, wants to be seen as a fighter.
"The Yahoo story that hasn't really been told, and what we've had to execute in order to do it, is we do believe we're innovating, we do believe we're changing, we do believe we're changing the game," Yang said. "My personal belief is if you're not in the game to win, you shouldn't be in the game, and that's the way that I try to encourage the whole company to think about."
How the 'Yahoogle' talks with feds fell apart
Early Wednesday morning, the Department of Justice notified Yahoo and Google that if they proceeded with their controversial search agreement, it would file a lawsuit to block the deal.
In some ways, the DOJ's decision was not terribly surprising. Over the past two or three weeks, federal antitrust regulators became increasingly wary of the agreement and, in particular, tested Google's resolve to remain in the deal, according to sources. Over the past few weeks, the give-and-take of negotiations between the parties seemed to be forward progress, but faltered as government regulators became increasingly unyielding in their demands.
"Up until a few weeks ago, there was a lot of back and forth," said one source. "After that, they began turning everything down."
Regulators, however, did not view it their role to advise the companies on how best to get the deal passed. Rather, sources said, they were there to evaluate the deal, as it was presented to them and any future versions that were submitted.
"We dealt with the (companies') proposals, as they made them...The suggestions for changes came from them," noted a source, who added that many of the things Yahoo and Google proposed were found to be anti-competitive.
Then things headed further south. Regulators, at one point two or three weeks ago, told Google that if it pursued a lawsuit to block the deal, it may consider adding a monopolization count against Google to the complaint, which in essence would allege the search giant of using its monopoly power in a relevant market. Apparently that hit a nerve with the search giant, noted a source, and it became evident to regulators that Google's resolve to fight a legal battle was wavering, rather than face the prospect of being saddled with the label of a monopolist and all the regulatory oversight that could potentially come with it.
Under its initial 10-year agreement announced in June, Yahoo would run Google's paid search ads on its own search pages and those of other third-party publishers. In return, Yahoo would get a cut of the advertising revenue.
Although the initial agreement did not call for caps that would limit the number of times Yahoo could run Google search ads on its own search pages, the companies increasingly began throwing out lower and lower caps to appease regulators, who were concerned Yahoo would either turn over its entire search advertising business to Google, or exit the business altogether, sources said.
While regulators, to some degree, appreciated the companies cutting their 10-year agreement to 4 years and then eventually 2, the caps increasingly became a tough pill to swallow.
In the last revised proposal before terminating the agreement, the companies had offered to not only limit the deal to two years, but also put a 25 percent cap on the amount of revenue Yahoo could receive from Google under the arrangement.
But there was nothing in the deal that would have prevented Yahoo, for example, from applying its 25 percent cap to a specific category of Yahoo's search advertising, thereby concentrating Google's presence in a particular part of Yahoo's search platform. The companies, however, did not see the benefit to advertisers, nor themselves, in using randomized search on Yahoo's search pages.
"Prior to two or three weeks ago, it seemed the regulators thought the cap was a promising solution," said a source. "But that changed over the last couple of weeks. Now, all sorts of problems were being identified with it."
During the course of the review process, the companies had extended the 100-day deadline it set in June from October 8 to October 22, as talks progressed among the parties. But as the latest extension deadline approached Wednesday, it became evident no further extensions were needed.
"In the last 24 hours, we really began to understand that the DOJ would not accept any deal under any terms," said a source.
No surprise, then, that the DOJ informed the companies Wednesday morning it would challenge a deal if they moved forward, resulting in Google backing away from the deal.
In some ways, the DOJ's decision was not terribly surprising. Over the past two or three weeks, federal antitrust regulators became increasingly wary of the agreement and, in particular, tested Google's resolve to remain in the deal, according to sources. Over the past few weeks, the give-and-take of negotiations between the parties seemed to be forward progress, but faltered as government regulators became increasingly unyielding in their demands.
"Up until a few weeks ago, there was a lot of back and forth," said one source. "After that, they began turning everything down."
Regulators, however, did not view it their role to advise the companies on how best to get the deal passed. Rather, sources said, they were there to evaluate the deal, as it was presented to them and any future versions that were submitted.
"We dealt with the (companies') proposals, as they made them...The suggestions for changes came from them," noted a source, who added that many of the things Yahoo and Google proposed were found to be anti-competitive.
Then things headed further south. Regulators, at one point two or three weeks ago, told Google that if it pursued a lawsuit to block the deal, it may consider adding a monopolization count against Google to the complaint, which in essence would allege the search giant of using its monopoly power in a relevant market. Apparently that hit a nerve with the search giant, noted a source, and it became evident to regulators that Google's resolve to fight a legal battle was wavering, rather than face the prospect of being saddled with the label of a monopolist and all the regulatory oversight that could potentially come with it.
Under its initial 10-year agreement announced in June, Yahoo would run Google's paid search ads on its own search pages and those of other third-party publishers. In return, Yahoo would get a cut of the advertising revenue.
Although the initial agreement did not call for caps that would limit the number of times Yahoo could run Google search ads on its own search pages, the companies increasingly began throwing out lower and lower caps to appease regulators, who were concerned Yahoo would either turn over its entire search advertising business to Google, or exit the business altogether, sources said.
While regulators, to some degree, appreciated the companies cutting their 10-year agreement to 4 years and then eventually 2, the caps increasingly became a tough pill to swallow.
In the last revised proposal before terminating the agreement, the companies had offered to not only limit the deal to two years, but also put a 25 percent cap on the amount of revenue Yahoo could receive from Google under the arrangement.
But there was nothing in the deal that would have prevented Yahoo, for example, from applying its 25 percent cap to a specific category of Yahoo's search advertising, thereby concentrating Google's presence in a particular part of Yahoo's search platform. The companies, however, did not see the benefit to advertisers, nor themselves, in using randomized search on Yahoo's search pages.
"Prior to two or three weeks ago, it seemed the regulators thought the cap was a promising solution," said a source. "But that changed over the last couple of weeks. Now, all sorts of problems were being identified with it."
During the course of the review process, the companies had extended the 100-day deadline it set in June from October 8 to October 22, as talks progressed among the parties. But as the latest extension deadline approached Wednesday, it became evident no further extensions were needed.
"In the last 24 hours, we really began to understand that the DOJ would not accept any deal under any terms," said a source.
No surprise, then, that the DOJ informed the companies Wednesday morning it would challenge a deal if they moved forward, resulting in Google backing away from the deal.
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