Contrary to popular opinion, the reason Yahoo’s metrics have been stagnant and its stock has lost half its value in the last two-and-a-half years isn’t because Google did search better than Yahoo. It’s because Yahoo turned its back on what it did well: Building the first online mass media content superstore. In doing so, it let the younger, sexier, faster-growing Google define what Yahoo wasn’t. It’s precisely the mistake that Jeff Bezos and Amazon didn’t make when eBay was the ecommerce, monkeys-could-run-this-train darling.Yahoo was never going to win at search, just like Amazon never would have won at auctions. It wasn’t in the company’s DNA. Even after millions spent to build better search and search monetization systems PANAMA! there were obvious gaffes. Vinny Lingham, who used to have a business running massive offshore keyword campaigns for US companies, hated buying them on Yahoo because he had to separately purchase keywords for each international territory, but with Google, the purchase experience was all unified on one screen.That’s because Yahoo was a company built on department-store like fiefdoms, with each country and division enjoying its own silo, vying for a slice of the front page with one another. When Yahoo was in the throws of its Microsoft take-over drama, I asked the head of one of Yahoo’s largest and most successful verticals what he thought about it. He answered, “It doesn’t really affect me, my division is basically a small business, and we can be the same small business inside of Microsoft.”You could see this approach mirrored in Yahoo’s always cluttered front page vs. Google’s stubbornly Spartan one. Google as an organization was almost allergic to the idea of giving people anything else to do to keep them on its site, while Yahoo’s former-CEO Tim Koogle once bragged that search queries were going down, keeping people from leaving Yahoo. There was a basic DNA to the two companies that was at odds: One all about enabling discovery of the Web and one all about enabling discovery of….Yahoo.It became fashionable to say Yahoo needed to be more of a technology company not a media company. But Yahoo was good at being a media company—it amassed an audience of half-a-billion people coming to its front page. When we launched TechTicker on Yahoo Finance it quickly got four-times the reach of CNBC. I’d love to take the credit, but that was the platform. Yahoo’s mistake was trying to become a Hollywood-style media company. Purple exclamation marks just aren’t Hollywood-cool no matter how many times Tom Cruise visits the campus.

via Trying to Be Something You’re Not: Works for Drag Queens, not for Google.