June 3rd, 2009
Bartz: Bing isn't all that (and neither is a Microsoft search deal)
Yahoo CEO Carol Bartz took aim at Microsoft’s Bing on Wednesday saying that the software giant’s latest effort won’t gain market share and will deliver only “temporary interest.” In addition, Bartz said Yahoo’s future would be cleaner without a deal with Microsoft.
Speaking at Bank of America’s 2009 Merrill Lynch technology conference (Techmeme, Webcast), Bartz reiterated some of her pitch at D7: Yahoo reaches younger users just like the social networks; the company leads in key markets; it has 20 percent of the search market; and it just needs to execute.
But the Bing comments indicate that Yahoo isn’t going to cede search market share easily. Some observers expect Microsoft’s search to swipe share from Yahoo, but Bartz dismissed those concerns. She said Bing is not over-the-top interesting” and added that most users will keep the same search habits (Google and Yahoo). Bartz also said she doesn’t think that Bing will bring Microsoft scale in search. Bartz said Microsoft is a company with “Google envy” even though its real gravy train is desktop apps.
“I don’t know if Bing means a whole lot to Yahoo. I think people will go to Bing because they are curious. I think they will get some uplift, but people will keep their same habits.”
Her other key point was that Yahoo didn’t need a Microsoft deal and said that the company’s future is “cleaner” without one. Those comments backtrack a bit from Bartz’s comments that Yahoo would need a boatload of cash to do a search deal with Microsoft. For the most part, the message is the same: Yahoo is in no hurry to do a Microsoft deal.
“Yahoo doesn’t have to do anything with Microsoft about anything,” said Bartz, who estimated that a search deal with Microsoft would save $500 million to $700 million. These savings would primarily be people and data center expenses.
When asked if it makes more sense for Yahoo to buy Microsoft’s Internet properties, Bartz said “I actually mentioned that.” But the Justice Department wouldn’t approve a deal where Yahoo acquired properties like Hotmail, she said. “It’s a great idea, but I don’t think it would work.”
Likewise, a full-blown Yahoo-Microsoft merger also would never get past the Department of Justice.
In fact, she said, the whole Microsoft-Yahoo fascination is overdone. “I personally think we would be better off if we never heard the word Microsoft.”
Other odds and ends:
- “Yahoo has way too much infrastructure, but you can’t fix that overnight. For everything you can do in three steps it takes Yahoo 22,” said Bartz, noting that systems and processes need to be overhauled. “It’s not hard, but will take time.”
- Bartz said Yahoo is just trying to drive audience on the mobile side of the business. “Monetization is the last thing on my mind for mobile. Our job now is audience. Get the audience you get the money,” said Bartz.
- Calling a bottom in the economy is a fool’s game, said Bartz.
- Yahoo’s ad serving platform will be better at targeting in a year and greatly improved the following year.
- Bartz said that Yahoo hasn’t missed the video train. Sure there’s YouTube and Hulu, but “video is just starting.” Yahoo is interested in providing video in context. Ditto for social networking.
Larry Dignan is Editor in Chief of ZDNet and Editorial Director of ZDNet sister site TechRepublic. See his full profile and disclosure of his industry affiliations.
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