“Media has long been one of Yahoo’s key strengths,” Yahoo President and CEO Marissa Mayer told a room full of techies at CES this week. And Yahoo's talent investments over the past year, like recruiting Katie Couric to lead an online video push as their "global anchor" and relaunching their Yahoo Tech channel with former Times columnist David Pogue at the helm, show the company is continuing to prioritize that part of its brand.
But while Yahoo is devoting more and more resources to content, the technical side is struggling. Just this fall, around a million users lost access to their Yahoo Mail accounts for days on end due to an extended hardware problem. To make matters worse, many of those users were already upset with the company over the e-mail redesign and changes to Yahoo Groups. (On a related note: The new Yahoo Mail is so poorly designed the company can't even get its own employees to use it.)
Then, within the past few weeks, Yahoo's ad service was hijacked to serve malicious ads to its homepage and some of its products. Those two technical problems were major incidents that would have been bad enough on their own, but were made worse by the company's apparent struggle to respond. Yahoo refused to confirm for days the exact number of users impacted by the e-mail outage. And the fact that the outage went on for days at all was a major warning sign that the company isn't equipped to provide the stability users expect from their online services.
Similarly, the company's statements to the media about the recent security breach suggested that the company wasn't even aware of the the problem until their sites had been spreading malware for days. Even after external security firms reported that the problem dated back to Dec. 30, Yahoo first told reporters that issue was limited to Jan. 3 before saying that it extended back to Dec. 31.
Yahoo has also been well behind its competitors on implementing some basic security standards: The company only announced it would be implementing SSL encryption by default for webmail users after being informed that the National Security Agency was relying on that oversight to scoop up the contents of millions of users' contact lists.
Those struggles, combined with Yahoo's enthusiasm for its content ventures, almost makes it seem as if Yahoo doesn't even want to be a tech company.
And according to Paul Graham, co-founder of startup seed accelerator Y Combinator, that's nothing new. Back in the 1990s, Yahoo bought out Graham's e-commerce start-up Viaweb for $49 million, bringing him on board in the process. Even then, he wrote in a 2010 blog post, Yahoo didn't consider itself a tech company. "One of the weirdest things about Yahoo when I went to work there was the way they insisted on calling themselves a 'media company.' " That preoccupation led to what Graham considered some skewed priorities.
The worst consequence of trying to be a media company was that they didn't take programming seriously enough. Microsoft (back in the day), Google, and Facebook have all had hacker-centric cultures. But Yahoo treated programming as a commodity. At Yahoo, user-facing software was controlled by product managers and designers. The job of programmers was just to take the work of the product managers and designers the final step, by translating it into code.
As a result of this structure, Graham says Yahoo's products just "often weren't very good" and the company hired "bad programmers." Mayer, who comes from a technical background at Google, does seem to be trying to change that problem — mostly by acquiring talent from failed start-ups. But the more obvious part of her strategy seems to be doubling down on defining Yahoo as a media venture.
Given its current resources, maybe that's the right direction for Yahoo. And it certainly makes for some splashy news conferences. But for users who rely on Yahoo's technology products, it could signal even more frustrating experiences ahead.