Paul Graham recently proclaimed Microsoft is dead. Time will tell, but at this very moment I’d rather be Microsoft than Yahoo.
Microsoft is still a leader. They rule the OS space, they rule the corporate desktop. They remain influential in many areas. They may not rule the web, but at least they remain leaders in very profitable spaces. And they have $40 billion in the bank.
Where is Yahoo’s leadership? What are they leading in? If they are leading, are their leadership positions profitable? Is their trajectory up or down? Their revenues are relatively flat, growth is flat, it’s all flat. You can stand to be flat for awhile when you are way ahead, but when you’re #2 and flat you’re not in a good place.
And it’s not like Yahoo is being attacked on all sides. They’re not being eaten alive by a gang of rats. They are being devoured by the 900-pound Googlerilla in the room. Google’s revenue is growing at twice the rate of the Internet ad business overall and 9x faster than sales at Yahoo.
Yahoo’s woes seem like a management issue. Semel’s gotta be on the way out soon. Yahoo has a boatload of talent. Yahoo is full of good people. But they’re not being led in the right direction. That’s on Semel.
So, yeah, for now I’d rather be Microsoft than Yahoo.
What about you?