A SMALL GIFT FOR ALL MY FRIENDS...
Saturday, October 10, 2009
Thursday, October 8, 2009
White House weighs Pakistan's role in winning war
WASHINGTON — Recognizing the U.S. can neither win in Afghanistan nor succeed more broadly against al-Qaida without Pakistan's cooperation, President Barack Obama's war council is weighing a new role for Pakistan in the 8-year-old struggle in the region.
Obama planned sessions Thursday with Vice President Joe Biden and Secretary of State Hillary Rodham Clinton in the Oval Office to continue the intense discussion about the increasingly unpopular war in Afghanistan. The White House scheduled another, larger war council session — a fifth of five announced — for Friday, when the focus may finally shift to just how many additional troops would be needed to execute Obama's vision for a war he inherited but now must execute.
The White House revealed that Obama has in hand — and has for nearly a week — the troop request prepared by the top U.S. commander in Afghanistan, Gen. Stanley McChrystal. It is said to include a range of options, from adding as few as 10,000 combat troops to — McChrystal's strong preference — as many as 40,000.
A senior Pentagon official said Thursday that the Obama administration's delay in deciding on a strategy has, in turn, stalled European allies who are weighing how much more to contribute to Afghanistan.
Allies "who may be asked to vote for additional resources at some point are all waiting to see exactly what the U.S. decides to do in the wake of the McChrystal assessment," Assistant Defense Secretary Alexander Vershbow, who oversees international security affairs, told reporters. "In the meantime, they have their own domestic issues and each individual country, those countries that have suffered high casualties are obviously having to deal with some who are arguing that the cost of this war isn't worth it."
However, most foreign governments realize that the overall goal is security — and not necessarily improved relations with the United States or NATO, said Vershbow, a former ambassador.
"When they have the answers for what the U.S. is going to do, I think we can expect them to take leadership in their countries to try to keep up their side of the operation," he said.
Obama's national security team marked the war's eighth anniversary on Wednesday with a three-hour session in a secure room in the White House basement. The focus on Pakistan, the suspected hiding place of Osama bin Laden and other al-Qaida terrorists as well as Taliban leaders, could provide a hint into the president's leanings.
Obama and some of his key aides are increasingly pointing to recent successes against al-Qaida through targeted missile strikes and raids in Pakistan but also in Somalia and elsewhere. Obama said Tuesday that al-Qaida has "lost operational capacity" as a result.
In Pakistan, though, the government has shown new willingness to battle extremists, with most believed to be operating from the largely ungoverned terrain along the border with Afghanistan. But these operations, as well as the strikes by unmanned U.S. aircraft, continue to stoke controversy throughout the country, causing problems for the already weak U.S.-backed civilian government.
White House press secretary Robert Gibbs said Obama asked for McChrystal's request last week before he flew to Copenhagen to lobby for Chicago's bid to host the Olympics and meet with the general on the sidelines. The numbers could become the focus of concentrated White House attention as soon as Friday, Gibbs said.
While Gibbs had said previously that Obama didn't want to see the request until he had determined the strategy, aides said the president decided it had simply become absurd to wait to read it given the high-profile debate.
McChrystal's recommended approach calls for additional troops in Afghanistan for a counterinsurgency campaign to defeat the Taliban, build up the central government and deny al-Qaida a haven. McChrystal, whose plan is somewhat reminiscent of President George W. Bush's Iraq troop surge in 2008, says extra troops — preferably at the higher end of his option range — are crucial to turn around a war that will probably be won or lost over the next 12 months.
On roughly the opposite end of the spectrum, an alternative favored most prominently by Biden would keep the American force in Afghanistan around the 68,000 already authorized, including the 21,000 extra troops Obama ordered earlier this year, but increase the use of surgical strikes with unmanned Predator drones and special forces.
Shrinking the number of troops in Afghanistan and turning the effort into a narrow counterterror campaign is not on the table, officials say, and neither is drastically ballooning the footprint.
In weighing whether to follow McChrystal or Biden or land somewhere in between, Obama faces a stern test and difficult politics.
Many lawmakers from his own Democratic Party, aware of rising anti-war sentiment in their ranks and the war protests that have dotted Washington this week, do not want to see additional U.S. troops sent to Afghanistan. According to a new Associated Press-GfK poll, public support for the war has dropped to 40 percent from 44 percent in July.
Republicans, meanwhile, are urging Obama to heed the military commanders' calls soon or risk failure.
With this and Americans' dwindling patience in mind, Obama is engaged in a methodical review of how to overhaul the war.
Sunday, May 10, 2009
LIVE from Google's Annual Meeting
Wireless gods willing (and they’re a little recalcitrant right now), I’m going to blog the highlights of Google’s annual meeting at the Googleplex, starting at 2 p.m. Pacific, as well as a press briefing beforehand. At the briefing will be CEO Eric Schmidt; David Drummond, chief legal officer and senior VP of corporate development; Susan Wojcicki, VP of product management; and Marissa Mayer, VP of search products and user experience. So stay tuned…
Annual meeting liveblog is after the jump.
The press questions begin:
Q: How viewing potential competition issues with Schmidt on Apple board?
Schmidt: I don’t think Google sees Apple as a primary competitor (with a smile). If there are issues that are competitive, I will recuse myself. So far, done so only on iPhone discussions.
Q: Will you consider resigning from Apple’s board? (To see what you would say, answers the questioner, Maggie Shiels of the BBC.) It hasn’t crossed my mind.
Kent Walker, corporate counsel, says the law clearly gives a safe harbor to companies with little overlapping revenues.
Q: Any signs of a bottom in business?
Schmidt: Won’t say except haven’t seen a change.
Q: On the federal probes lately, and the impact on partnerships:
Schmidt: We should expect governments around the world to pay attention to what we do and hold us to the principles we have articulated.
We are more careful about when and how we do things that could raise concerns with any party, but that care doesn’t stop us from doing those things.
Q: Question on Google Book Search agreement that feds are looking into. Didn’t hear anything new from Google on this.
Q: Prospects for long-term monetization of social networks?
Wojcicki: We’ve been learning a lot about how to monetize this inventory. We believe there are ways to monetize it over time. But the nature of it is different from search. Has to be more compatible with the social network.
Q: Why did you sell your stake in AOL?
Schmidt: We love AOL. We also like money. We sent our best guy over there to run it! (Laughs; he’s referring to former Google sales exec Tim Armstrong’s recent move to be CEO at the Time Warner unit.)
Q: Plans for Google News? Not much new here.
Q: YouTube’s losing a lot of money.
Schmidt: YouTube will eventually be a successful and profitable business. Not sure when. Wojcicki: Serving ads on hundreds of millions of videos. New formats that are promising are pre-roll and in-stream ads. We’re just at the beginning of doing new ad formats. Introduced a sponsored video on the right-hand side if you do a search. Video owner can do this promotion. Also click-to-buy ads.
Q: About Google’s cost-cutting
Schmidt: We were very careful with the cutbacks. Took out a lot of future costs with them. We don’t want to be wasting money at a time when the global recession is going on.
Q: Expect any particular bright spots AFTER the recession?
Schmidt: It’s early to speculate on post-recession. Pretty much same opportunity as before—Internet use not slowing down much.
Q: Any details on the decline in cost-per-click on search ads in the first quarter?
Schmidt: Nothing beyond the first-quarter report. “The system reacted to economic changes we all saw correctly,” that is, the drop was a reaction to people buying less or lower-priced products, so it made sense ad prices fell. This proves Google’s auction process is competitive, Schmidt adds.
Q: Status of China business, in terms of human rights issues and censorship as well:
Drummond: It’s an ongoing challenge to operate there. We think that on balance, we’re doing good in China. It’s a difficult road.
Schmidt: We’ll be in China (not leaving as some companies like eBay have).
A few other questions I’ll fill in when I get better connectivity…
Q: What do you think of people saying Google is the new Microsoft?
Schmidt: They obviously don’t remember the old Microsoft. To me, there’s no comparison.
Q: Any change in acquisition strategy (Schmidt said recently prices were still too high on many potential acquisitions)?
Eric: No change. We’re waiting for the right opportunities at the right price.
ANNUAL MEETING:
And the meeting comes to order... the usual intros of the board and boilerplate stuff... A couple of shareholder proposals on stopping Internet censorship and on universal health care, proposals which Google opposed, get their airing. An apparent China activist interrupts the meeting by trying to ask further questions on that proposal but is more or less shouted down. Later he walks out of the meeting.
Now Eric Schmidt talks about Google's business:
It's very easy to get conservative as a large company. Now is the time to be even more innovative. Recessions can be a very good time for innovation.
Internet revolution happening around the world.
Search is still the killer app. We still don't know quite how to give you every answer you want. ... Doing it right and doing the world's perfect search engine remains very very difficult.
We want to do the same thing with advertising. This is a local business. Launching new front end for AdWords, its ad system.
Display advertising has the same property but it's earlier in the cycle. We really want to bring the science of search to the art of display. YouTube doing similar things with respect to advertising choices. The two together ultimately will provide a significant new business for Google.
Mobile searches have risen five times (didn't catch since when). Mentions Google Latitude, the location service for mobile devices. So as you walk around, can get history of buildings, etc. (He doesn't mention ads, for some reason.)
Applications: Looking to bring same capabilities to home and work with Google Apps.
The economic situation is still tough. But we're going to run Google for the long term. We know that the model that we follow... will give us a very good shot at being innovators in a new and exciting future.
Now the same folks as in the press call come up for Q&A. But where are Sergey Brin and Larry Page, the cofounders and presidents?
Q from one self-described small shareholder wants to talk about the first shareholder proposal criticizes public-pension-fund proposals unlikely to pass.
Q: Thanks them for being Google. Three suggestions on proxies, shareholder proposals, and a Google sports site. Mayer says there are a lot of Google "Gadgets" on its iGoogle personalized home page. Also adding scores to search results.
Q: Speaker has a concern about online publishers and how one of his sites went from $2,000 a day in December (peak season for this site), then dropped to $100, then back up again. Can't tell what happened and no mechanism to find out. Also cites restrictions on multiple Google ad accounts. Google is in danger of leaving substantial money on the table and appearing arrogant.
Wojcicki: Admits there's an issue of support for smaller advertisers. Could consider fee service for support in the future. Algorithms change often, so that can change monetization.
Q: Is customer base loyal? He cites Yahoo and Microsoft combined having 30% market share, so one in three people are going to rivals. Why aren't we totally blowing away the competition today? (He's not kidding. He must be the only person in the world who thinks Google isn't dominant enough.)
Mayer: She notes how Google makes hundreds of improvements a day.
Q: Could Google's energy initiative remake the utility business, and will that benefit Google and its shareholders?
Schmidt: I hope that we have the kind of impact that your question presupposes. I doubt we're going to become an energy business. We see ourselves as the nexus of information about energy. Ultimately that could result in some significant revenue in the information part of this energy challenge that we face.
Q: Suggestions from another shareholder: Health-related search results have a lot of repetition and not organized to make things easy to find. Also, translation from other languages isn't very good. Mayer on search: Looking for better ways to surface health info.
Q: On Schmidt's and board member Arthur Levinson's membership on Apple's board and the FTC looking into whether that raises antitrust issues: Will you resign from Apple's board? Let's make sure that we're not an illegal monopoly!
Schmidt: Disagrees with a lot of the assumptions in the question. Same answer as before.
Q: Assessment of employee morale and productivity?
Schmidt: There's a lot of perks still, let me tell you. But didn't want to waste money. Cutbacks welcomed by employees. My sense of it is that morale is pretty good, with the caveat that people are upset that their friends are losing jobs in some parts of the world. Wojcicki: The perks are still really good. Still 15 cafeterias on campus. The perks are so we can do our jobs better, so we can be more efficient, so we don't have to drive off campus to have lunch.
Q: Don't split the stock. No answer to that.
Q: Suggestion: Offer fundraising Websites to nonprofits. Mayer talks about an iGoogle Gadget that can help on that. Wojcicki: Admits not all the pieces have been put together.
Q: Comment: Glad AFL-CIO health care proposal failed, says it's trying to bring socialized medicine.
And that's it for the meeting. Nothing surprising, sorry to say.
Annual meeting liveblog is after the jump.
The press questions begin:
Q: How viewing potential competition issues with Schmidt on Apple board?
Schmidt: I don’t think Google sees Apple as a primary competitor (with a smile). If there are issues that are competitive, I will recuse myself. So far, done so only on iPhone discussions.
Q: Will you consider resigning from Apple’s board? (To see what you would say, answers the questioner, Maggie Shiels of the BBC.) It hasn’t crossed my mind.
Kent Walker, corporate counsel, says the law clearly gives a safe harbor to companies with little overlapping revenues.
Q: Any signs of a bottom in business?
Schmidt: Won’t say except haven’t seen a change.
Q: On the federal probes lately, and the impact on partnerships:
Schmidt: We should expect governments around the world to pay attention to what we do and hold us to the principles we have articulated.
We are more careful about when and how we do things that could raise concerns with any party, but that care doesn’t stop us from doing those things.
Q: Question on Google Book Search agreement that feds are looking into. Didn’t hear anything new from Google on this.
Q: Prospects for long-term monetization of social networks?
Wojcicki: We’ve been learning a lot about how to monetize this inventory. We believe there are ways to monetize it over time. But the nature of it is different from search. Has to be more compatible with the social network.
Q: Why did you sell your stake in AOL?
Schmidt: We love AOL. We also like money. We sent our best guy over there to run it! (Laughs; he’s referring to former Google sales exec Tim Armstrong’s recent move to be CEO at the Time Warner unit.)
Q: Plans for Google News? Not much new here.
Q: YouTube’s losing a lot of money.
Schmidt: YouTube will eventually be a successful and profitable business. Not sure when. Wojcicki: Serving ads on hundreds of millions of videos. New formats that are promising are pre-roll and in-stream ads. We’re just at the beginning of doing new ad formats. Introduced a sponsored video on the right-hand side if you do a search. Video owner can do this promotion. Also click-to-buy ads.
Q: About Google’s cost-cutting
Schmidt: We were very careful with the cutbacks. Took out a lot of future costs with them. We don’t want to be wasting money at a time when the global recession is going on.
Q: Expect any particular bright spots AFTER the recession?
Schmidt: It’s early to speculate on post-recession. Pretty much same opportunity as before—Internet use not slowing down much.
Q: Any details on the decline in cost-per-click on search ads in the first quarter?
Schmidt: Nothing beyond the first-quarter report. “The system reacted to economic changes we all saw correctly,” that is, the drop was a reaction to people buying less or lower-priced products, so it made sense ad prices fell. This proves Google’s auction process is competitive, Schmidt adds.
Q: Status of China business, in terms of human rights issues and censorship as well:
Drummond: It’s an ongoing challenge to operate there. We think that on balance, we’re doing good in China. It’s a difficult road.
Schmidt: We’ll be in China (not leaving as some companies like eBay have).
A few other questions I’ll fill in when I get better connectivity…
Q: What do you think of people saying Google is the new Microsoft?
Schmidt: They obviously don’t remember the old Microsoft. To me, there’s no comparison.
Q: Any change in acquisition strategy (Schmidt said recently prices were still too high on many potential acquisitions)?
Eric: No change. We’re waiting for the right opportunities at the right price.
ANNUAL MEETING:
And the meeting comes to order... the usual intros of the board and boilerplate stuff... A couple of shareholder proposals on stopping Internet censorship and on universal health care, proposals which Google opposed, get their airing. An apparent China activist interrupts the meeting by trying to ask further questions on that proposal but is more or less shouted down. Later he walks out of the meeting.
Now Eric Schmidt talks about Google's business:
It's very easy to get conservative as a large company. Now is the time to be even more innovative. Recessions can be a very good time for innovation.
Internet revolution happening around the world.
Search is still the killer app. We still don't know quite how to give you every answer you want. ... Doing it right and doing the world's perfect search engine remains very very difficult.
We want to do the same thing with advertising. This is a local business. Launching new front end for AdWords, its ad system.
Display advertising has the same property but it's earlier in the cycle. We really want to bring the science of search to the art of display. YouTube doing similar things with respect to advertising choices. The two together ultimately will provide a significant new business for Google.
Mobile searches have risen five times (didn't catch since when). Mentions Google Latitude, the location service for mobile devices. So as you walk around, can get history of buildings, etc. (He doesn't mention ads, for some reason.)
Applications: Looking to bring same capabilities to home and work with Google Apps.
The economic situation is still tough. But we're going to run Google for the long term. We know that the model that we follow... will give us a very good shot at being innovators in a new and exciting future.
Now the same folks as in the press call come up for Q&A. But where are Sergey Brin and Larry Page, the cofounders and presidents?
Q from one self-described small shareholder wants to talk about the first shareholder proposal criticizes public-pension-fund proposals unlikely to pass.
Q: Thanks them for being Google. Three suggestions on proxies, shareholder proposals, and a Google sports site. Mayer says there are a lot of Google "Gadgets" on its iGoogle personalized home page. Also adding scores to search results.
Q: Speaker has a concern about online publishers and how one of his sites went from $2,000 a day in December (peak season for this site), then dropped to $100, then back up again. Can't tell what happened and no mechanism to find out. Also cites restrictions on multiple Google ad accounts. Google is in danger of leaving substantial money on the table and appearing arrogant.
Wojcicki: Admits there's an issue of support for smaller advertisers. Could consider fee service for support in the future. Algorithms change often, so that can change monetization.
Q: Is customer base loyal? He cites Yahoo and Microsoft combined having 30% market share, so one in three people are going to rivals. Why aren't we totally blowing away the competition today? (He's not kidding. He must be the only person in the world who thinks Google isn't dominant enough.)
Mayer: She notes how Google makes hundreds of improvements a day.
Q: Could Google's energy initiative remake the utility business, and will that benefit Google and its shareholders?
Schmidt: I hope that we have the kind of impact that your question presupposes. I doubt we're going to become an energy business. We see ourselves as the nexus of information about energy. Ultimately that could result in some significant revenue in the information part of this energy challenge that we face.
Q: Suggestions from another shareholder: Health-related search results have a lot of repetition and not organized to make things easy to find. Also, translation from other languages isn't very good. Mayer on search: Looking for better ways to surface health info.
Q: On Schmidt's and board member Arthur Levinson's membership on Apple's board and the FTC looking into whether that raises antitrust issues: Will you resign from Apple's board? Let's make sure that we're not an illegal monopoly!
Schmidt: Disagrees with a lot of the assumptions in the question. Same answer as before.
Q: Assessment of employee morale and productivity?
Schmidt: There's a lot of perks still, let me tell you. But didn't want to waste money. Cutbacks welcomed by employees. My sense of it is that morale is pretty good, with the caveat that people are upset that their friends are losing jobs in some parts of the world. Wojcicki: The perks are still really good. Still 15 cafeterias on campus. The perks are so we can do our jobs better, so we can be more efficient, so we don't have to drive off campus to have lunch.
Q: Don't split the stock. No answer to that.
Q: Suggestion: Offer fundraising Websites to nonprofits. Mayer talks about an iGoogle Gadget that can help on that. Wojcicki: Admits not all the pieces have been put together.
Q: Comment: Glad AFL-CIO health care proposal failed, says it's trying to bring socialized medicine.
And that's it for the meeting. Nothing surprising, sorry to say.
Tuesday, April 21, 2009
Obama Signs Volunteer Bill With Nod to Kennedy Era
WASHINGTON — President Obama on Tuesday became the latest Democratic president to emulate John F. Kennedy’s call for national service as he signed legislation to triple the size of the Americorps program and called on Americans to volunteer time to improve their communities.
Joined by Kennedy’s brother and daughter, Mr. Obama took his turn at the Peace Corps legacy by enacting a new law expanding the government’s role in promoting and paying for Americans to restore parks, tutor children and help communities struck by natural disasters.
“We need your service right now, at this moment in history,” Mr. Obama told an audience at the Seed School of Washington. “I’m not going to tell you what your role should be. That’s for you to discover. But I’m asking you to stand up and play your part. I’m asking you to help change history’s course.”
In addition to advancing the Kennedy ideal, the ceremony was an opportunity to bury Democratic rivalries. Mr. Obama was flanked by Senator Edward M. Kennedy and Caroline Kennedy, whose endorsements last year helped him win the Democratic nomination. Also joining them was former President Bill Clinton, who was upset when the two Kennedys did not back Senator Hillary Rodham Clinton’s campaign.
Mr. Obama acknowledged Mr. Clinton from the lectern and credited him with starting Americorps in 1993. But the former president did not sit on stage and was not asked to speak.
Instead, Mr. Obama hugged and lavished attention on Senator Kennedy, who is fighting brain cancer and seemed physically tentative as he climbed onto the stage with his cane, but was spirited in his own remarks about passing on his brother’s torch.
“Today another young president has challenged another generation to give back to this nation,” said Mr. Kennedy, for whom the legislation was named.
The new law authorizes the increase of Americorps to 250,000 positions from 75,000 by the year 2017, increases its education subsidies and creates a reserve of Americorps veterans to mobilize in disaster zones. To begin paying for it, Obama proposed $1.1 billion for Americorps in his budget plan, a 25 percent increase over last year, but Congress still must vote to pay for the expansion.
After the ceremony, Mr. Obama and Mr. Clinton doffed their coats and ties to travel together to Kenilworth Park and Aquatic Gardens to plant trees in a muddy riverside marsh. The two presidents seemed in good spirits and teased each other about their tree-planting ability.
“I think the president has pretty good shoveling skills,” Mr. Obama said after watching Mr. Clinton demonstrate the proper technique.
Joined by Kennedy’s brother and daughter, Mr. Obama took his turn at the Peace Corps legacy by enacting a new law expanding the government’s role in promoting and paying for Americans to restore parks, tutor children and help communities struck by natural disasters.
“We need your service right now, at this moment in history,” Mr. Obama told an audience at the Seed School of Washington. “I’m not going to tell you what your role should be. That’s for you to discover. But I’m asking you to stand up and play your part. I’m asking you to help change history’s course.”
In addition to advancing the Kennedy ideal, the ceremony was an opportunity to bury Democratic rivalries. Mr. Obama was flanked by Senator Edward M. Kennedy and Caroline Kennedy, whose endorsements last year helped him win the Democratic nomination. Also joining them was former President Bill Clinton, who was upset when the two Kennedys did not back Senator Hillary Rodham Clinton’s campaign.
Mr. Obama acknowledged Mr. Clinton from the lectern and credited him with starting Americorps in 1993. But the former president did not sit on stage and was not asked to speak.
Instead, Mr. Obama hugged and lavished attention on Senator Kennedy, who is fighting brain cancer and seemed physically tentative as he climbed onto the stage with his cane, but was spirited in his own remarks about passing on his brother’s torch.
“Today another young president has challenged another generation to give back to this nation,” said Mr. Kennedy, for whom the legislation was named.
The new law authorizes the increase of Americorps to 250,000 positions from 75,000 by the year 2017, increases its education subsidies and creates a reserve of Americorps veterans to mobilize in disaster zones. To begin paying for it, Obama proposed $1.1 billion for Americorps in his budget plan, a 25 percent increase over last year, but Congress still must vote to pay for the expansion.
After the ceremony, Mr. Obama and Mr. Clinton doffed their coats and ties to travel together to Kenilworth Park and Aquatic Gardens to plant trees in a muddy riverside marsh. The two presidents seemed in good spirits and teased each other about their tree-planting ability.
“I think the president has pretty good shoveling skills,” Mr. Obama said after watching Mr. Clinton demonstrate the proper technique.
Yahoo's Bartz Starts Strong
The Net giant's new CEO turns in a solid first quarter, with more cost-cutting ahead
In these uncertain times, perhaps that's a question no company can adequately answer. Indeed, Yahoo (YHOO) Chief Executive Carol Bartz said in a conference call with analysts, "The economy clearly remains a challenge for us." Bartz said brand marketers put the brakes on ad spending, especially on display ads, the pictorial banners that are Yahoo's chief source of business. Display ad revenues on Yahoo's properties fell 13% from a year ago. What's more, Yahoo's search advertising business, which is much smaller than leader Google's, fell 3% after several quarters of strong, double-digit growth.
Street Not Disappointed
Yahoo also issued guidance for second-quarter results that came in slightly under what analysts had been forecasting. Still, given the poor and unpredictable state of the overall economy, investors appeared to like what they heard, sending shares up about 5% in trading after the market closed. Just before the earnings announcement, shares had already risen 5%, to 14.38, partly on reports that Microsoft (MSFT) and Yahoo are talking anew about an advertising deal.
The latest round of layoffs at Yahoo, amounting to about 675 people, will come largely in engineering organizations, which are being consolidated internationally, Chief Financial Officer Blake Jorgensen told BusinessWeek in an interview. Bartz provided a more characteristically salty description of the changes she thinks are needed in product development, which will now be headed by Chief Technology Officer Ari Balogh. "We had a lot of people running around telling engineers what to do but nobody was ******* doing anything," she said on the conference call.
One possibility being floated is that Yahoo could let Microsoft take over sales of search ads on both firms' sites, while Yahoo could handle display ads for both. Such a deal could save Yahoo as much as $1.3 billion annually and bring in as much as $800 million in revenues from Yahoo selling display ads on Microsoft's sites. The Boomtown blog reported on Apr. 20 that talks were heating up between the two companies, but it appears that Microsoft is more enthusiastic than
While the first-quarter performance may have bought Bartz more time to work her magic, it's unclear how much more time she has to get Yahoo stabilized. "Her honeymoon days are numbered," says Kessler.
Cost-cutting helped Yahoo! satisfy investors with its first-quarter earnings report on Apr. 21, and the company announced plans to cut 5% of its staff, on top of 1,600 job cuts in December.
But the Internet icon left largely unanswered precisely how it would restore revenue growth beyond waiting for the economy to improve.
In these uncertain times, perhaps that's a question no company can adequately answer. Indeed, Yahoo (YHOO) Chief Executive Carol Bartz said in a conference call with analysts, "The economy clearly remains a challenge for us." Bartz said brand marketers put the brakes on ad spending, especially on display ads, the pictorial banners that are Yahoo's chief source of business. Display ad revenues on Yahoo's properties fell 13% from a year ago. What's more, Yahoo's search advertising business, which is much smaller than leader Google's, fell 3% after several quarters of strong, double-digit growth.
Still, analysts said they were impressed with Yahoo's ability to rein in costs, much as search rival Google (GOOG) managed to do last week. "The benefits of cost-cutting were visible," says Sandeep Aggarwal, an analyst with financial-services firm Collins Stewart (CLST.L). Yahoo's operating expenses fell to $779 million, or 49% of revenue, from 52% a year ago. And cost savings came not so much in key investment areas such as research and development but in marketing and administrative costs.
Street Not Disappointed
As a result, Yahoo's net income of $118 million, or 8¢ a share, matched analysts' expectations.
That was down 78% from a year ago, though last year's results included a big gain from Yahoo's stake in the Chinese Internet company Alibaba, which staged a successful initial public offering.
Yahoo's net revenue, excluding one-time charges and the commissions Yahoo pays partner Web sites for running ads, fell 15%, to $1.16 billion, slightly below analysts' forecasts.
Yahoo also issued guidance for second-quarter results that came in slightly under what analysts had been forecasting. Still, given the poor and unpredictable state of the overall economy, investors appeared to like what they heard, sending shares up about 5% in trading after the market closed. Just before the earnings announcement, shares had already risen 5%, to 14.38, partly on reports that Microsoft (MSFT) and Yahoo are talking anew about an advertising deal.
The latest round of layoffs at Yahoo, amounting to about 675 people, will come largely in engineering organizations, which are being consolidated internationally, Chief Financial Officer Blake Jorgensen told BusinessWeek in an interview. Bartz provided a more characteristically salty description of the changes she thinks are needed in product development, which will now be headed by Chief Technology Officer Ari Balogh. "We had a lot of people running around telling engineers what to do but nobody was ******* doing anything," she said on the conference call.
Renewed Deal Chatter
However, Bartz provided few specifics on what's coming next for Yahoo—especially concerning Microsoft. The software giant's repeated buyout and search-ad deal offers last year were all rebuffed by Yahoo under co-founder Jerry Yang, who handed over the CEO reins to former Autodesk (ADSK) Chairman Bartz in January. Bartz met Microsoft CEO Steve Ballmer recently, raising the possibility that the two companies are considering a range of deals.
One possibility being floated is that Yahoo could let Microsoft take over sales of search ads on both firms' sites, while Yahoo could handle display ads for both. Such a deal could save Yahoo as much as $1.3 billion annually and bring in as much as $800 million in revenues from Yahoo selling display ads on Microsoft's sites. The Boomtown blog reported on Apr. 20 that talks were heating up between the two companies, but it appears that Microsoft is more enthusiastic than
Yahoo.
In keeping with an earlier vow not to negotiate in public, Bartz said little about the potential for a deal. "Search is a very valuable business for Yahoo. That's all we're going to say about search for today," she told analysts. She also reiterated her belief that Yahoo needs to retain some stake in search to help it target display ads better. "Search is important to our users and search is important to our advertisers," she said.
Being Careful with Search
That's why some observers believe even a search deal alone could take longer than investors might hope, if it happens at all. "Yahoo's concluding that there's strategic value in search, so they don't want to get rid of it," says Ted West, CEO of search ad network LookSmart (LOOK).
A joint effort in search could take some time. "All indications are this will not be a simple and easy-to-execute deal," says Scott Kessler, an analyst with Standard & Poor's, which like BusinessWeek is a unit of The McGraw-Hill Companies (). "And it's not forthcoming any time soon." Kessler on Apr. 17 downgraded his stock ratings on both Yahoo and Google to "hold," citing weak revenue growth in online advertising as well as recent rises in both companies' shares.
Bartz also offered few details on Yahoo's strategy for restoring growth besides asserting that the company would benefit from a turn in the economy by virtue of its size and presence online, and that it would focus on "creating kick-ass products." "I came away with no impression for what the company's going to do," says Jeffrey Lindsay of Sanford Bernstein & Co. "We couldn't see the strategy of how they're going to grow the business again."
Bringing In New Blood
Bartz, who has been shaking up the management ranks, announced one new appointment: Jeff Russakow from Symantec (SYMC) has joined as senior vice-president of customer advocacy, a new position Bartz had announced previously. In late February, she combined tech and product groups, appointed a chief marketing officer, Elisa Steele, and collapsed international sales regions.
The moves encourage some Yahoo watchers. Organizational design expert Jay Galbraith, founder and president of Galbraith Management Consultants, said Bartz is making the right changes so far. "Nobody had stepped up to make the hard decisions," he said. "She's got the stomach that Yahoo has lacked." But he said eventually she would have to make further changes in management and how it's organized to get Yahoo back on track.
While the first-quarter performance may have bought Bartz more time to work her magic, it's unclear how much more time she has to get Yahoo stabilized. "Her honeymoon days are numbered," says Kessler.
Google Profiles tool makes it easier to search out Smiths
Google has good news for all the Mike Smiths, Leslie Joneses and others with common names who have trouble looking themselves up on Google.
Tuesday, Google introduced new tools to its search index that give folks named Jones and Smith — common names that often get lost in results — a chance to be found.
A "Profiles" section on Google search results lists the top four people at the top and others underneath. Users who take the time to get a Google ID and beef up their profile can show up there.
Danny Sullivan, editor of website Search Engine Land, says this is Google's attempt to take on Facebook and Twitter, sites frequented by people trying to connect with past and new friends.
"This improves Google's relevancy in people search," he says.
Many people use Google (GOOG) to search for themselves, just to see how they're presented to the outside world, and are unhappy with the results, says Joe Kraus, Google's director of product management.
"They have little control over how they appear in Google," he says. "And sometimes the search results are dominated by people with a large Web presence."
While Kraus says that Google made these moves to improve the overall experience for searchers, analyst Greg Sterling of Sterling Market Intelligence says the change is also a way to get Internet users more linked to the Google ID feature — and potential services.
Once you have the ID, you might be more inclined to shop with Google Checkout, post pictures at Picasa Web Albums or build a blog on Google's Blogger, all areas where Google stands to profit with either fees or ads, Sterling says. "It deepens your engagement with Google."
Currently, names show up at the top of search results for people who either are well known, or have large Web presences and take the time to link their website, blog, Facebook, Twitter, LinkedIn, YouTube and other sites. Leaving comments on other blogs and sites can also improve your position in search results.
The Profiles section previously listed your name and included a photo. Now the section allows multiple photos, relevant links to your website and blog, age and employment information — similar to information that sites such as LinkedIn and Facebook showcase.
Kraus says the online profiles will level the playing field a bit for searches. But interested people must take the time to add to their personal and Web data.
The most prominent names will still probably be listed on top, Kraus says, but the fact that all the Mike Smiths, for instance, will be linked together in a people section means "you won't have to hunt and peck through the entire index looking for that person," he says. "It helps you narrow the results down to people."
To sign up, go to google.com/profiles.
Tuesday, Google introduced new tools to its search index that give folks named Jones and Smith — common names that often get lost in results — a chance to be found.
A "Profiles" section on Google search results lists the top four people at the top and others underneath. Users who take the time to get a Google ID and beef up their profile can show up there.
Danny Sullivan, editor of website Search Engine Land, says this is Google's attempt to take on Facebook and Twitter, sites frequented by people trying to connect with past and new friends.
"This improves Google's relevancy in people search," he says.
Many people use Google (GOOG) to search for themselves, just to see how they're presented to the outside world, and are unhappy with the results, says Joe Kraus, Google's director of product management.
"They have little control over how they appear in Google," he says. "And sometimes the search results are dominated by people with a large Web presence."
While Kraus says that Google made these moves to improve the overall experience for searchers, analyst Greg Sterling of Sterling Market Intelligence says the change is also a way to get Internet users more linked to the Google ID feature — and potential services.
Once you have the ID, you might be more inclined to shop with Google Checkout, post pictures at Picasa Web Albums or build a blog on Google's Blogger, all areas where Google stands to profit with either fees or ads, Sterling says. "It deepens your engagement with Google."
Currently, names show up at the top of search results for people who either are well known, or have large Web presences and take the time to link their website, blog, Facebook, Twitter, LinkedIn, YouTube and other sites. Leaving comments on other blogs and sites can also improve your position in search results.
The Profiles section previously listed your name and included a photo. Now the section allows multiple photos, relevant links to your website and blog, age and employment information — similar to information that sites such as LinkedIn and Facebook showcase.
Kraus says the online profiles will level the playing field a bit for searches. But interested people must take the time to add to their personal and Web data.
The most prominent names will still probably be listed on top, Kraus says, but the fact that all the Mike Smiths, for instance, will be linked together in a people section means "you won't have to hunt and peck through the entire index looking for that person," he says. "It helps you narrow the results down to people."
To sign up, go to google.com/profiles.
Spies hack into U.S. military computers
WASHINGTON, April 21 (UPI) -- Spies hacked into U.S. military computers, copying data that could threaten the effectiveness of U.S. fighter jets, The Wall Street Journal reported Tuesday.
In recent months, the newspaper said, someone was able to get into
Pentagon's $300 billion Joint Strike Fighter project and take several terabytes of information concerning design and electronics systems. Officials told the Journal it could make it easier for America's enemies to defend against the F-35 Lightning I fighter jet.
The Journal reported the Air Force's air-traffic-control system also was breached in recent months.
"There's never been anything like it," one source told the Journal, adding that other military and civilian agencies as well as private companies are affected. "It's everything that keeps this country going."
While former U.S. officials told the newspaper it appeared the attacks originated in China, the specific identity of the attackers and the extent of the damage to the U.S. defense program wasn't known. However, the hackers weren't able to access the most sensitive material, which is stored on computers not connected to the Internet, the Journal said.
In recent months, the newspaper said, someone was able to get into
Pentagon's $300 billion Joint Strike Fighter project and take several terabytes of information concerning design and electronics systems. Officials told the Journal it could make it easier for America's enemies to defend against the F-35 Lightning I fighter jet.
The Journal reported the Air Force's air-traffic-control system also was breached in recent months.
"There's never been anything like it," one source told the Journal, adding that other military and civilian agencies as well as private companies are affected. "It's everything that keeps this country going."
While former U.S. officials told the newspaper it appeared the attacks originated in China, the specific identity of the attackers and the extent of the damage to the U.S. defense program wasn't known. However, the hackers weren't able to access the most sensitive material, which is stored on computers not connected to the Internet, the Journal said.
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