Jeremy Zawodny has a blog post entitled Yahoo's Peanut Butter APIs where he writes
Over the weekend someone sent me email that, among other things, said
roughly: "I’m glad to see that APIs weren't on the list of things Brad
Garlinghouse wants to get rid of. That means you're safe, right?"
Now, if you're one of the people who's asked me what I think about all
this... here's my answer: Brad is very right about some things and
terribly wrong about others.
A couple of us were chatting about the memo at lunch yesterday and I realized that if I was a Yahoo! employee my spider sense would be tingling like mad. I'd also be considering talking to my peeps at GOOG and MSFT to see if they had any openings I was interested in just to hedge my bets. There are the three things about the memo that made me come to this conclusion
The memo recommends 15% - 20% head count reductions. This means that Yahoo! executives are contemplating firing one in five Yahoo! employees. How is it going to be decided whose job is safe and whose isn't? Layoffs are a demoralizing affair and often don't eliminate the right people especially since the really smart people know to desert a sinking ship instead of hanging around to see if they draw the short straw.
A supposed senior VP at the company seems unable to tell the difference between the audience for Flickr vs. Yahoo! Photos or the difference between Konfabulator widgets and plugins for the Yahoo! IM client.Out of touch executives tend the bundle similar products in their mind and view it as redundancy without understanding the context in which they exist. This often leads to merging of products and the pissing off of customers. If Yahoo! actually goes through with the implied recommendations from this memo expect Netscape.com-like traffic drop offs by some of their users.
People in glass houses shouldn't throw stones. If you look at Brad Garlinghouse's record it sounds like he is actually an example of the problem he rails about in his memo as opposed to the savior people in the blogosphere are calling him for penning the memo. See the article Yahoo's Misguided Manifesto which contains the following excerpt
Here again, Yahoo! should start with accounting
for Garlinghouse's performance. Under his watch, Yahoo! Messenger let a
huge opportunity for voice-over-Internet protocol, or VoIP, slip
through its fingers as eBay ( snapped up Skype. And Yahoo Mail
dropped behind Google's Gmail as the most prestigious Web-based email domain.
That performance has been more chunky than smooth, yet Yahoo! has
gotten off easy. Earlier, Garlinghouse was CEO of VoIP leader Dialpad,
which promptly spiraled into bankruptcy, but not before Garlinghouse
laid off 90 of his 140 employees. A 2002 case study of Dialpad in the Harvard Business Review discussed how Garlinghouse struggled with a failed business model while rival Net2Phone won a $1.4 billion investment from AT&T as well as deals with Microsoft and Yahoo!.
That's right, didn't Garlinghouse's group purchase OddPost 2.5 years ago and yet still hasn't figured out how to integrate the offering into Yahoo! Mail besides making a molasses slow Web-mail experience that is still in beta? Is this the guy whose going to save Yahoo! and show it how to integrate Flickr into Yahoo! Photos or del.icio.us into Yahoo! MyWeb. Good luck, you're going to need it.