As part of its audit process, evaluating its vast array of products and services, Yahoo! has decided to shutter Geocities the hosted community business which it bought in May 1998 for $3.75 billion. The closing of Geocities joins Farechase, Yahoo Briefcase, Yahoo Pets and My Web as part of CEO Carol Bartz’s plan to “increase investment in some areas while scaling back in others” While setting some products aside, Yahoo will continue putting money into its search business and attempt to become more social and open in its product set.
No argument with closing down Geocities. In fact, in a recent internal research call, we asked on another if anyone knew if Geocities was still around. That says it all. Geocities was neither fish nor fowl in that it not as easy to set up as a blog and not as robust or valuable as a simple templated Web page with its own domain hosted by a low-cost provider such as Go Daddy. Yahoo’s efforts to spin Geocities from a loosely formed community into a revenue-generating business failed around 2001 when members rebelled against migrating from free to paid hosting model. From that point on, Geocities lost its mojo as web community. From the spin control POV, Yahoo must devise a way to placate those (according to compete.com) 13 million users who visited Geocities in March.
Cup half full: shutting down underperforming businesses is proof that Bartz is prepared to make the difficult decisions needed to get Yahoo back on its feet. Cup half empty: Such moves may be too little too late. Cup status undecided: What major product news will Yahoo make to showcase its ability to see in the future while fixing past mistakes?
1 response so far ↓
1 Xander // Apr 24, 2009 at 5:31 am
Wouldn’t it perhaps be smarter to let such a system ’starve’ by itself? What are the real costs of just leaving Geocities out there, without providing any technical support? As said, most of us had already forgotten about its existence, until the present day.
Thoroughly wiping away Geocities might indeed reduce some costs, to be interpreted as a positive signal by Yahoo’s nervous share-holders. They will be happy, for an instant.
But for the Yahoo web-users, how does it by now feel to be using a Yahoo powered service, knowing they decide so easily about spoiling all your work and energy spent on uploading stuff, just ‘allowing you to download all your content before the end of the year’?
By trashing a site full of user-generated content, long term harm is done to the Yahoo imago, chasing core clients away. The short term cost reduction will not compensate for these long term indirect costs.
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