Yahoo CEO Jim Lanzone: The Web is Still a Great Business

Channel: Alex Kantrowitz

Published at: 2024-04-04

YouTube video id: 3J16mvppddo

Source: https://www.youtube.com/watch?v=3J16mvppddo

the Yahoo episode is here long awaited anticipated 
asked for and now delivered yes the CEO of Yahoo
is here with us to Deep dive into the state of the 
company Yahoo episode on big technology podcast is
coming up right after this welcome to Big 
technology podcast a show for cool-headed
nuance conversation of the tech world and Beyond 
we're here we're in it it's the Yahoo episode
uh we have Jim lanzone he's the CEO of Yahoo and 
also Ronan Roy is here with us a rare appearance
on a Wednesday show I want to welcome both of 
you first of all welcome Jim great to see you
good to see you again Alex and welcome Ronan 
Ronan uh you kind of kicked this off I think
that we were talking about this on a Friday 
show and you mentioned something like Yahoo
is the most underappreciated uh company in the 
entire uh Tech World um and you expressed your
your excitement we had so many people write in 
talking about how they were interested in the
Yahoo episode as well so I'm curious to hear just 
to to start off and and then I'll let you ask the
first question to Jim but set set us up here like 
talk a little bit about your your uh passion for
Yahoo and why you thought this was an episode we 
had to do yeah for me whether it's media whether
it's technology whether it's news there's so 
many stories that we all obsess over dayto day
and week to week meanwhile Yahoo is the number one 
news site in the country still per traffic number
two in sports number two in email number one in 
finance eight out of 10 Americans visit a Yahoo
property every month like the numbers when I've 
heard them are astounding yet we you know spend
time on with the minutia of tiny media startups or 
tiny Tech startups so the fact that Yahoo you know
was taken private is being worked on and different 
strategy are being implemented which I'm excited
to learn more about I think is the most important 
media and Tech story around right now and I I'm
excited to learn more along with our listeners 
media oh media and Tech okay so now we're really
bigger than AI on come on so let's bring Jim I'm 
sure there's gonna be some AI in it so Jim when
when you hear that do you think what what do you 
think because obviously you're coming in um you
were like pretty pretty humble getting started 
talking about basically I think there's a quote
from you saying that every single product uh needs 
work in in Yahoo and you're going to work hard to
revitalize the business so like it's interesting 
to hear the contrast right like bronan and I
here are talking about like reading the stats and 
saying this is you know huge and underappreciated
and you're like this is a turnaround story so can 
those both be true uh well first good to see you
guys thanks for having me I I feel a little out 
of I don't have one of the big mics here so out
of place here um but um one over yeah I uh I do I 
do think that're they're actually both true I've
said that before when when you know asked about 
coming here and what was in the decision it look
it it does have a lot of the trappings of a a big 
turnaround otherwise you know it given all the
things ronon said it wouldn't have been spun out 
of Verizon at the price it was which was around5
billion um you know for something that's still 
a top five property probably has been top five
every month as long as the internet has existed 
uh and if you had if you if you were to take the
name off of it I've said before with this many 
users this much revenue this much profit um you
know what would that be worth how would you think 
think about that company um at the same time it
it's it's been through the ringer you know over 
the over the years right um a lot of time uh as
a struggling public company eventually sold a 
Verizon spent five or six years there uh and
um and so but you know in in a lot of ways both 
things are true um and that's that's part of what
I love about it and that's part of the challenge 
of it but that's also why we're we're why we're
humble about it at the same time you know in some 
ways it kind of mirrors the story of the web I
mean you know I was thinking about like why do we 
care about Yahoo and then you know in many ways
like Yahoo was maybe the original way at least it 
was for me where people started accessing the web
um preg Google right and the company still has 
all this size uh yet I guess financially it can
be tough to to make money on the web so I guess 
I'm curious to hear your perspective on um you
know the meme right now is that it's a lost cause 
to try to make money on the web and traffic is no
longer worthwhile like Ben Smith wrote this whole 
book called traffic saying basically like his
miscalculation with BuzzFeed was that traffic 
equals money so you have all the traffic um
you've had adtech right to help make money off of 
that and that's gone through a transformation um
but just from the fundamental level like can you 
still make money on the web and what is traffic
worth these days I think it's all a matter of 
perspective you know there's a difference between
the trillion dollar plus companies and what they 
make um and you can be a very healthy thriving
business at a differ size company and uh and you 
know search is I I used to work in search for a
long time and and I'm back at it now that that's 
one way of making money from a large amount of
traffic ads are obviously another subscription 
lead genen e-commerce I mean those are probably
the main the main five um one of the big things 
that we have going for us uh is not only size but
also you the majority of our Impressions and our 
uh you know are from logged in users so we have a
huge amount of first-party data people are coming 
direct to us and so that's another you know big
difference is that people choose Yahoo finance 
they choose Yahoo sports they choose Yahoo news
and mail um and so you know we're not thirsty 
for traffic and out there trying to get it in
unnatural ways we're we're lucky to have people 
coming directly to us um you know this the days
of of when Yahoo was the One-Stop portal is is 
probably something to work your way back to if
that were something that anybody you know should 
be trying to achieve at this point um you know our
strategy is much more to lean into Our Brands and 
you know we've hired general managers to run each
one of these Brands as an independent business 
there are cousins they're related uh people do
go from site to site and app to app um but you 
know they each have different ways to monetize
in their in their given verticals they have 
different audiences and the strength of the
company is actually to lean into that um but not 
to compare ourselves to Facebook or Google or or
something much larger it's it's I always say 
we're here to compete against ourselves it's
our growth rate versus ourselves and where we 
are tomorrow versus yesterday um and there's a
lot of right sizing has to go you know to get 
the company from where it was as a standalone
company or part of Verizon to where we need to 
be as a new Standalone company going forward
which is a lot of the work we're doing behind it 
um but yeah I I I think there you know we have
the very healthy thriving audience at the top of 
the funnel and then there's other ways that we
you know monetize them as we move them through 
yep so I just want to ask one more followup to
that and Ron will jump in afterwards but there's 
this sort of dramatic scene in this information
story about you guys that came out last year so 
there's this internal presentation and I think
you say that Yahoo's non- search ad sales fell 
by 18% in the fourth quarter of 2022 two and
then next paragraph there's 1 1600 Lay layoffs 
and and then that's sort of like where the path
is set for like where your leadership of Yahoo is 
going to take this company and how you're going
to actually push forward this uh this turnaround 
so what is what has happened since then I mean
obviously we know that the properties are doing 
quite well but like what have you put into place
since then um from that August let's say August 
2022 meet or fourth quarter 2022 meeting well
um one of the things about that is it was it was 
definitely taken out of context so and the things
that done actually part of the changes that we've 
been making so last February we announced that um
well let's go back both Yahoo and AOL which we 
also own over the years acquired 30 plus adte
companies and um and so when they came together as 
oath in in 2017 or or you know whichever year that
was um you know those things were kind of munged 
together into one unified stack which became the
go to market uh for Yahoo ads at the same time and 
that included native advertising which is the old
platform called Gemini as part of Yahoo incl our 
own SSP and include our own DSP and you need buy
you need bup and DSP are like the the tools that 
people use to sell and then demand side platform
or buy right and so adver they were they were 
kind of forced to go through our platform in
all ways to to work with us at the same time 
our owned and operated properties our consumer
properties were forced to use that as their only 
means of monetization so you had a lower yield on
our sites and we had a suboptimal very expensive 
losing lots of money um to grow Topline chasing
that strategy so the decision that we made was 
to um you know was to reduce that footprint to
go after only the DSP where we really strong and 
we really compete well in that market uh to shut
down the SSP because we need to be we couldn't 
give that to somebody else and give them access
to our supply uh and then to we did this deal 
where we took 25% of tula and we shifted all of
our native ad advertising Supply to them so you 
own 25% of tabula now we now own 25% of tabula
because it was it's you know we essentially gave 
a this huge amount of Supply to them right uh and
that was worth more than just the money we would 
pay for that and for those who don't know tabula
is like the related you might also be interested 
in links on the bottom Pages native Native ad
Supply and you know they had eight times as many 
advertisers so essentially what happened is we
we then immediately swapped out our own stack for 
much better yield much better relevance much lower
cost on our side and we were able to focus in fact 
this current quarter now a year after we announced
uh those reductions is the first time where we've 
ever been able to only focus on the DSP with with
our product development um because we had to work 
our way you know out of the old system so with
that came the reduction of 20% of our Workforce 
who were associated with those products so that
was very strategic decision uh about you know who 
we needed at the company you know what jobs were
needed at the company um another part of that 
was was getting out of certain International
markets so when you saw the reduction and revenue 
that's what this was associated with was starting
in November of 22 was like getting out of those 
markets switching over our native ad Supply and
starting the migration uh to you know this new 
this new platform that we're operating um so
that that's just put that in in context I think 
that was out of context um as far as what we're
doing the that's what we're doing for the adtec 
side which is running uh now a DSP that's highly
competitive with the trade desk and db360 and 
others um and so that that business is growing
Nic is is doing very well so can I just pause 
to that that DSP demand sided platform basically
allows people to buy allows your customers to 
buy advertising across the web not just Yahoo
properties but both using your but also using your 
that data that you have we're using our identity
solution as one part okay and and theirs Ian which 
is normally part of that um and you know we have
a really good algorithm called ad learn that that 
we've operated for a long time that's part of that
as well um all that also allows us to to then put 
a lot of our effort on the consumer side you know
and that's the original thesis of Apollo buying 
Yahoo about me coming to Yahoo um was that these
properties do have a lot of traffic but have 
been uh have not been invested in as much as
they could um we brought in I think world class 
leaders to run every one of those so across uh
you know Sports Finance news brought in you know 
entirely new teams and have been spending this
past year Really Cooking in the you know we've 
in the kitchen cooking brand new versions of
every one of these products that starting a couple 
some are in testing right now so a lot of them are
actually live in beta with a sliver of our user 
base over the course of 2024 you will see brand
new versions of every Yahoo product come to Market 
um and then at the same time we actually hired our
first CMO in a long time uh trusty Lieberman who 
came in from Chipotle uh who is a jenz Whisperer
in Social Med uh expert and then uh my new had a 
PR who came from Lyft and Facebook and the go to
market then becomes the the story in the back half 
of the year after we bring all the new products
to Market like can so can you walk through what 
does verticalization look like across different
properties whether it's Finance or Sports I 
think that's very interesting how the general
manager strategy versus that kind of centralized 
approach that it sounds like things used to be
operated under but but what does that look like 
in one vertical versus another um well this is a
lesson I learned 13 years ago when I I became the 
CEO of CBS Interactive which was it was under CBS
Corporation but we had multiple companies in 
there including former public companies like
sports line and CET and we had little ones like 
Last FM and so the first year my background's in
product so the first year I was like let's go 
and tried to run every product myself or with
the central team and realized very quickly that 
that was not going to scale but the only way to
do it was to develop what we eventually called 
the federal and state model where every business
every brand has its own GM governor and they have 
their own economy culture location a lot of times
um you know monetization and you what you want 
to do is let them hire people who are talented
and entrepreneurial and let them run uh running 
their business and our job and federal at this
the central uh you know level of the portfolio 
is to Pro provide expertise and leverage at the
center maybe provide services that are generic 
that you don't want to do more than once but
every one of those businesses then has a GM has a 
head of product has a head of Technology usually
has a head of content um ahead of design and you 
let them go and I'll accept inefficiencies at the
edges in order to let them own the relationship 
with their customer and be able to develop quickly
and with the expertise developed you know for 
that and so so what you then wind up finding is
you then have people joining you who love or join 
For the Love of the Game of that vertical and so
uh you know so Ryan spoon who who came in Ran ESPN 
product for eight years B MGM so rare he is the GM
and president of Yahoo sports top and Bot who way 
back was Jeff Weiner's number two at Yahoo back in
the day but he was the COO of NerdWallet and so 
he's the head of Yahoo finance um and then hired
another person from the you know fintech industry 
is the head of product um cat Downs Moulder is the
uh is the GM of Yahoo news and home and she was 
the um Chief product officer and managing director
of The Washington Post and so down the line you 
get the these I brought in some of my search guys
for for the search team um Etc so you you have 
dedicated experts who are the best at what they
do my job is is to support them maybe play dentist 
on their plans and and some of their processes and
people but you know otherwise like I'm I'm there 
to to let them run and so with the Federate and
state model you had mentioned the underlying 
technology stack I think you had said it took
you know almost a year to start moving away from 
the ssps being integrated in things like like
how does the Legacy Yahoo Tech stack influence 
that verticalized federal state model like does
everyone are they able to build whatever they want 
does that create a huge challenge or headache it's
way better that way actually so if you imagine 
the other so the the stack we were talking about
was the adte stack so that's that that's its own 
separate thing what you I think are talking about
the stack supporting the product side and there is 
a there is a platform that everybody is is built
on um but it's it's very Nimble enabling them to 
really control their own destiny and to build what
they want to build and so we do have things like 
trying to be more consistent with fonts or with
you know uh you know certain ways that we render 
things but but otherwise I actually like them to
be independent um and to let Yahoo finance really 
super serve uh Finance users who are really loyal
to that product who have certain needs um in 
fact it's probably a good time to back up one
more step which is when we got here you know the 
first thing to do was to to not overreact and to
really understand what makes you who tick what 
makes all these people who use the product so are
so loyal to it trust it so much over the years 
um but at a certain point you did you you know
you do step back and say you know if the average 
public company I think I heard the other day is
only around 10 and a half years we've been here 29 
in various formations um you know what is our what
is what is the mission today what is our reason 
to exist today and and and why have people been
so loyal to it over time including the fact that 
you know they they miss search which is kind of
something you can't undo right that and we could 
talk about that but the the mooved to Google in
June of 2000 you know was its own thing that time 
was spent trying to undo but at this point is not
a realistic uh job like we can still participate 
in Search and make good money from search but like
Google is Google at that at this point um and so 
if you go back the original Yahoo was the guide
to the worldwide web and Alex to your Point what 
happened was you know uh the internet was created
and then Mosaic and Netscape was created to 
to let you access it but nobody knew how to
get to anything and so that's what Yahoo was for 
in our best versions of ourselves we are still
that trusted guide to every one of these vertical 
categories as we think about other categories that
we could be in going forward um we would think 
about the same way like where is that trusted
guide needed to help people accomplish their goals 
big or small when they come to Yahoo and and not
to be judgmental about that it could it could 
be the weather or it could be trying to make
a million dollars it could be saying your March 
Madness brackets this week which I was just doing
before we got online here um you know it could 
be any of those things our job is to compress the
time it takes for you to accomplish those goals 
and that is very different vertical by vertical
you know what you're trying to accomplish in Yahoo 
finance is different than news is different than
Sports is different in Surge for mail um and 
that's the framework that we built out to attack
everything that we're doing yeah it kind of uh 
it does build on that original portal mission
right like if you you would go to the portal to 
figure out like what the sports score was or who
won read the game story find out how your stocks 
are doing and then like your content businesses I
guess are natural evolutions of that so it seems 
like you're you're planning to think of new areas
to expand into that you could play a similar role 
well I don't I don't even think of them as content
I I we we have content yes I want to actually 
talk to you about that yeah yeah go ahead well
as if you think about what we do and again Yahoo 
CEOs used to be beat up about whether they're a
media company or a technology company in my for 
some reason the media loved asking that question
which I think silly not it's hard to be pure one 
or the other go ahead well the real answers were a
product company and we deploy media to help people 
accomplish their goals um and we use technology
behind to deliver all of it but you know um we 
you know so the real underpinning of Yahoo are
unique data sets Superior a aggregation and then 
uh and then having content anchors that provide
context uh for everything that you're doing and 
so those are really the three underpinnings of
of every vertical that we that we have but you 
know setting your fantasy lineup is not content
um you know setting up your stock portfolio 
and checking it and making trades is not is
not necessarily content and you can kind of go 
down the line and understand of course news is
although things like you know weather is is you 
know there are other parts of news that that
aren't um obviously mail and search are not media 
and content that traditional sense so I think we
deploy media to help people uh be successful but 
I don't I don't think that's all we do right and
this is sort of like one of the seems like one 
of the key insights that you're bringing into the
company is that and maybe it was there before but 
you're certainly seem to be enhancing it it's like
we we're looking at all these struggles in the 
content industry or content journalism news media
media you know pick your pick your noun right and 
a lot of them seem to have been betting entirely
on just the stories and I look through like every 
vertical that you guys have and it seems like it's
more for instance in finance you have uh Yahoo 
finance plus which has data and research tools
and 2 million monthly users and I read that it's 
growing double digit percentages year-over-year
um and then you with Yahoo sports you uh you 
bought the peer-to-peer gambling site wager
uh so it's like Finance plus extra Services it's 
Sports Plus you know potentially some gambling you
know you you look through it um each one of these 
content verticals has something more and it looks
like you've also in Yahoo finance scaled back 
advertising 40% which like if you think about
a traditional quote unquote content play no one 
would ever do that yeld went up actually so uh
so there there was a logic to that right so but I 
guess like to to me is that is that sort of your
answer of like what it what doing what running 
a successful business on the web today really
requires it's like both that content hook but 
then also some sort of deeper engagement with
the audience uh that goes beyond just reading 
the story yeah and and again we're lucky to be
in verticals and own products where we're not 
chasing traffic you know 86% of you as Internet
users hit Yahoo every month I think it's 36 
or 36.5 billion minutes per month just in in
the US so they're I do think that that's common 
of every major consumer property that there's a
topof the funnel that you have to nourish you 
know you have to have users they have to be
deeply engaged you have to have them coming at a 
certain frequency right I think those are the unit
economics of the user side we talked about the the 
financial ones and that really is is making sure
that you're de you're you know you're at the top 
of your game and uh in serving their user needs
and that that sounds like you know cliche but 
that's that's absolutely the job and over time
though that changes always so you're never done 
it's like it's you know paying the Golden Gate
Bridge which is why I actually think Yahoo can 
be around another 29 years it's like the the the
need people's goals are not going away and our 
first job is in the vertical that we already own
to do an A+ job of delivering against that in the 
most modern effective way possible and that's all
the work you know I think that we're doing now we 
also could could very easily play in New Vertical
or or go more seriously into them like in if you 
look at the rankings we're number one in Beauty
and Fashion even though we don't really have that 
a really dedicated product to that um you know
things like Health travel these are all places 
that I think we have a right to play local there
there's so many things that we could do um and and 
I think that the the name of the game would would
be the same in in every one of those so where does 
the Yahoo brand fit in here You' mention bringing
on a new CMO had aoms but you had also said at the 
beginning that any one of these Brands almost if
you remove the Yahoo brand also stands on its 
own in terms of the numbers in terms of users
and revenue as a pretty significant business so 
how do you see the Yahoo brand evolving or what
are you trying to do with it right now to unify 
everything um well step one is to to lean into the
indiv individual brand so you have to nail that 
first given where where you know again the days
of of a One-Stop portal have were a long time 
ago I mean for the internet in general that's
not how it's used at this point but I do think 
the notion that if you really understand your
users and you really personalize Yahoo the way it 
could be personalized if you do deploy AI which
we're already doing you know across every one of 
these vertical it's it's already embedded in into
the products so we're building behind that um I do 
think that the notion that we could uh anticipate
user needs and deliver what they they want um 
you know in the least amount of work possible
is another way you could you know you may say it's 
like a portal but you're kind of coming out for a
different reason but it kind of gets you back to 
the same place and we do need the Yahoo brand to
be really strong and suppor of those Brands and 
then eventually if you do it right then the Yahoo
brand itself can uh can have its own place and 
I think coming back at that um in a um you know
in a in a slow but surely over time I one of the 
things I found since I got here is that and maybe
this this goes to some of the Retro vintage flavor 
that's really in in society right now um there's a
lot of latent love for the brand um I think people 
are rooting for it deep down they they would love
to see us be able to you know kind of get it back 
to a good spot and you know we have to reward that
Faith with great products but I think if we do um 
I think that there's an opportun for that um by
the way one really small example is is we just 
dipped our toe in the water South by last week
um I don't know if you guys know what pool Suite 
is um go a pool s it's this hipster Retro Brand
it's it's almost impossible to describe it's like 
a Lifestyle brand that this this guy Marty in the
UK developed I mean it's you might have pictures 
of of people drinking martines and jaguars you
might have pink flamingos floating in pools he's 
selling a sunscreen and does like a huge amount
of revenues new selling vacation sunscreen that 
he developed it's a Vibe this brand and and he
reached out and we did a collab party at South by 
Southwest rooftop 12 hours uh 12 to 12 and it was
uh it was the highest number of RSVPs they've ever 
had for anything and um and I I think that there's
that that kind of there is a little latent love 
there for the brand if we reward it the right way
Yahoo is vintage and retro now I like it modern 
modern modern vintage is what I would call it
right well so we made it we made it 25 minutes in 
when ai's finally been brought up I was curious
you I mean are you saying the vision is that the 
next kind of iteration of the Yahoo promise and
brand is some kind of AI driven personalized 
experience given the stronger each individual
vertical gets is that the larger Vision or that's 
definitely part of it I think that's a destination
though for it in the meantime you guys have talked 
a lot about this that you know the in the in the
near future the most common way for a or AI to be 
deployed if you're not talking chat gbt or some
of the uh you know some of the companies that 
have taken off is going to be you know for core
services and how is it supporting that uh both in 
inside the company and then for consumers so you
know going back a year we we launched uh AI into 
mail to help you write the mail you know write
your email edit it search for it summarize it 
um we you know it's deeply embedded into fantasy
sports believe it or not to help you set your 
lineup uh without you actually doing any work you
got to pay a subscription tier for that product 
um even uh things like smack talking emails that
go out on on Mondays after uh after the games on 
Sundays summarizing that week's games um making
fun of people for the the name of their team 
that was happening through AI there's a lot more
happening with that um Finance obviously helping 
you you know um invest more smartly so every every
one of these verticals has it obviously we have 
search too and um and so we we have our Microsoft
relationship um you know that's that goes back a 
number of years and will go number of years into
into the future but you know bringing that 
into search is is obviously happening is is
a no-brainer so so what I'd say is it's deployed 
across everything we're doing and then the company
as well like ways to to make us more efficient um 
you know whether it's customer service through to
um to engineering I definitely want to talk about 
uh that search bar right in that partnership with
Microsoft so why don't we take a quick break and 
after the break we're going to talk about I'm
looking at Yahoo right now the top uh bar right 
there is search and that's an important piece of
real estate for you guys and I guess for Microsoft 
as well so uh let's take a break and talk about
what's going to happen with that thing right after 
this and we're back here on big technology podcast
with Jim lanzone CEO of Yahoo great to have 
you back Jim Ron Ron Roy is here with us as
well the Yahoo episode we're doing it the Yahoo 
episode my my giant Yahoo coffee mug I know you
and and a Yahoo football helmet in the background 
that's uh that is vibing pretty strongly as well
got the by vibe to it but uh yeah so before the 
book we were talking about search and obviously
like you guys will have decisions to make on 
that search bar we just we talked about this a
couple weeks ago but uh Gartner had this number 
out that said 2 traditional search was going to
decline 25% in uh in a year and a half or a year 
and three quarters by 2026 and um I interviewed
Gartner folks and we talked about it and their 
big uh thought there was like it's going to take
basically big platforms with a lot of search 
Real Estate to say we don't want traditional
search anymore we're going to implement generative 
AI to make this move happen cuz I was like looking
at it and saying what are you talking about like 
Bing hasn't made Google budge at all uh but their
their idea is basically like big platforms whether 
that's apple or somebody else uh you know might
say well we much prefer to serve generative AI 
answers to our audience uh or our users versus
like the traditional Link Link uh uh project so 
what are you going to do and and what are the
considerations that go into a decision like that 
because I imagine you're you're evaluating it and
you have the right partner in Microsoft so walk us 
through a little bit about what's going to happen
there I think it's a little more simple for th for 
us and I it's funny I I definitely did a deep dive
after you you all had that had that discussion and 
I I read everything about it and and um I mean I I
believe they were saying it's it's based on uh 
on on on decisions Apple was going to make in
2026 and they're projecting a lot with that yeah 
a lot of a lot of extrapolation I spent my first
10 years in search including ask geves we're 
we were part of the turnaround team there um
so natural language and all those things are near 
and dear to me um direct answers all that um yeah
look for for our search the the I mean there 
are people who start their search experiences
with Yahoo a huge number of people are searching 
because they're there for all the other services
that we have our job is to be awesome so that the 
next time they're with us and think yeah may as
well just search a Yahoo um we reward that that's 
actually a really proven way uh to grow search
um I've done that in the past so in order to do 
that obviously AI answers are are going to be a
big part of it number one because I I do believe 
it's growing the category um I don't think it's
a one forone replacement for every type of search 
that's happening I think that um what we used to
call Smart answers what Google calls one box is 
already bringing that directly into the page so
you're getting both types of search I actually I 
think that's way more common than than people who
are attacking uh Google and and bang are are 
acknowledging I I think you you kind of can
do both in in the search uh UI um and you know 
we're going to do this we we obviously need to
do the same thing and this goes way back for me 
because my our team at ask in that 2003 to 2007
period we we really led the way on Direct answers 
and getting Beyond 10 BL links that's kind of what
we know right and yeah but that was well that 
was very different than the original ask which
was natural language that really couldn't really 
answer anything because it was just so early it
was just too early um we actually ours was pulling 
from structured databases to to to bring you know
weather or you know lyrics or whatever is going 
to be right into the page and that that really
is a great way to use AI generated answers right 
now I mean if you know including if you type in
how does perplexity AI work into into Google 
with Gemini lit up and into perplexity is is
very interesting uh who gets the answer right 
and where who gets it right they pull it from
perplexity uhx is pulling it from Reddit and some 
other places oh my god um that's fascinating it's
uh it's it's so broad search is so Broad and I 
definitely think it is incrementally um added to
the category you're now asking things you wouldn't 
have asked search engine um and it is creating
answers that a search engine was not able to do 
right um by predicting the next word Etc from
from its its database um and so uh so look for 
for Yahoo we're definitely incorporating it uh
in everything we do including search and um and I 
think it's it's as much an opportunity as a threat
to the search category they're both true wait can 
you walk through you said your experience said Ask
Jeeves was turnaround what was the what what was 
the turnaround experience and I guess were there
any valuable lessons that you're bringing to the 
Yahoo story now oh yeah I mean so we our new team
got there at the end of 2001 after the market had 
crashed I think I was announced on 911 as joining
as the head of product and um and our stock was 
under a dollar uh it had been crushed and then the
company had gone you know I think had uh uh had to 
uh remove 75% of its employees it was definitely a
turnaround it wasn't profitable and so and and was 
doing too many things there were eight different
things from Enterprise search to consumer search 
that was trying to do including a bunch of other
things and and so it was our first lesson my first 
lesson in focus and doing what you're really great
at and and the fact that if you have a large user 
base that's product to seen better days where the
um you know the team could probably be improved 
where the brand had seen better days if you just
focus on crushing it for your for your users for 
the users you already have that that actually will
pay off over time in improvements and retention 
and frequency and search that's linear and in
2002 we switched to Google AdWords we're I think 
we're the first ones to do that which helped us
become profitable and S our stock on a I mean I 
think we 50x that thing from there and then we
sold IC in February of of 2005 um and so that that 
lesson of of you know huge audience with with all
these things that could be improved is like the 
the core basis for a turnaround is something I I
took to CBS Interactive where we had that problem 
across a number of our properties if you do that
you then make your own fuel to invest and at at 
ask that that was definitely into investment even
deeper into Search innovation at CBS it was we 
we actually launched cbsl access which became
Paramount plus uh years later um the first plan 
we we introduced for that was November of 2011
it launched in October of 2014 not as a how do you 
uh save you know the streaming future you know it
was much more as a premium product to introduce 
a subscription layer on top of our free layer um
and we uh funded that ourselves from within CBS 
Interactive based on the performance of the other
brands that hav't been part of the turnaround 
so yeah I mean that that was part of when when
I started talking to Apollo about Yahoo uh before 
they bought it you know that was my thesis I was
like if you for the right price I think it's the 
mother of all turnarounds even though again to our
earlier conversation it's already you know doing 
a lot of Revenue it's already very profitable um
but getting into the growth trajectory that would 
make you a sustainable company for the future is
is really the the trick here and and that's 
the work we're doing now but but based on a
lot of the lessons I had in the past let me ask 
you about private Equity okay because like the
the the public perception of private Equity firms 
is not very very uh unless you're an investor in
them is not very positive I think like most people 
think that a private Equity Firm just kind of like
comes in and vultures out all the potential profit 
and then um you know basically leaves the skeleton
with all the money and that's the end of the 
company uh what do you think about that I think
that's how's that how's it different stro because 
I have friends at other private Equity firms
definitely they all have their playbook and some 
of those playbooks involve what you're talking
about some involve putting in their own people 
to drive their specific operational Playbook
forget just the reductions but doing that um and 
and you know my own my only personal experience
with private Equity has been my experience with 
with Apollo which has been great since day one
since my first conversation with them uh through 
to them buying it and then turning around and
recruiting me in to then the last two plus years 
working for them has been great I mean again we've
we've um we've been on the same page about the 
thesis the entire time they've uh you know it's
I should say one of the benefits for us has been 
that it's one of the fastest returning Deals they
ever had so you know we we we did a number of 
deals to sell things that that we owned um you
know we we sold a c we had a CDN business that we 
then merged with another company to to uh become
a public company we um you know we we've you know 
so we've returned a lot of cash to them that lets
them invest in the upside here so it's just been 
a different situation I think and then I think we
probably have tripped them out a bit in our new 
team uh being proactive with making sure that we
have the right size company um the right platforms 
that we supporting and they haven't had you know
whe whether they were or not going to come to us 
to say let's reduce these costs the cost have been
naturally reduced here in a strategic way not 
to save money because we didn't you know we've
been making a lot of money so we don't it hasn't 
been for that reason it's been to strategically
position us for the future with more you know 
doing more what we should be doing and less of
you know of the thing everything that we inherited 
so um so maybe this is a one-off in terms of that
experience but but Reed Raymond who's the chairman 
and then David samber Lee Solomon eay Wang who are
the other three main Apollo people involved have 
just been great with us we involved them deeply
on a you know daily and weekly basis now how 
we're doing things not with a gun to our head
but because they're helpful so I don't have 
I don't have a dramatic no that's good answer
yeah is I mean you I'm sure if we screwed up it' 
be different things been going pretty well so far
well what does success look like then because if 
you're saying again if each individual property
can stand alone on its own if as a company that's 
still profitable you know still growing at least
in the way that you want it to what does that 
what does success on the turnaround look like
then what's the bigger two to threee Vision or 
whenever an IPO would be coming how does this
get pitched to the markets well look the only the 
only pitch you can make uh I was you know as you
know companies are bought not sold right and so 
the thing that we have to do no matter what the
outcome is here and whether that's um all of 
Yahoo is acquired parts of Yahoo are acquired
by different people we have an IPO like whatever 
those are that the task for my team doesn't change
which is it's about growth it's about growth on 
the user side Revenue side the iida side profit
side and um and and and make you know again I've 
it's weird because I've founded two companies uh
but I've spent the majority of my career now 
in public companies and and clearly what you
need is sustainable growth over time right um 
companies can go public too early they can be
in a position where they're struggling to make 
quarters like that that's not the right place uh
for anybody so um so I think we're you know this 
the first time Yahoo's been private since 1995 and
we're taking advantage of that to to build this 
out the right way we made a lot of changes we're
we're still digesting a lot of those changes um 
with the puts and takes to get to the other side
we're investing in every product that we own in 
a major way uh with an awesome team and you know
that's the plan right now I think you will see 
us continue to be aggressive in terms of trying
to figure out what we can add to it which would 
be in two ways we could it could be a major deal
that adds a vertical or adds a major new product 
it could also be you know we've done Alex as you
point out some of the smaller deals to enhanced 
products that we're building get us there faster
um and again not Aqua hires but actually like you 
know products that we think are important to what
we're doing um I think you'll continue to see that 
and uh and so we're you know we're building uh
this Transformer here to uh uh to to you know to 
be a healthy fighting machine in the future well
is there for that kind of vision of sustainable 
growth is there some magic formula you think of
around kind of advertising Revenue vers premium 
subscription revenue or because obviously every
Media company is always asking itself that what's 
the what's the ideal combination is that is there
some high level goal you have around that or 
Insight again I think it's just different if
you're if you are a premium content brand then you 
can you have a right to have a percentage of your
your users convert to subscription if you're super 
premium maybe your only subscription and there may
be a maybe perhaps a limit depends if you're 
Spotify or Netflix versus The Economist or you
know the Atlantic or the New Yorker what your you 
know what your scale can be for that for a company
like ours we're monetizing in all five of the ways 
I mentioned earlier right and it's always a funnel
top of the funnel is the broadest it's the most 
free and you're monetizing uh that audience in
in certain ways down funnel you earn the right 
to convert them into into premium products and
you know subscriptions could be one sport you 
know maybe you know betting is uh is another way
you might think about that but you you convert 
them down down that pathway that's really how
you run these kinds of properties um or at least 
the majority of them right things like search are
different um we do have a subscription layer for 
every product that we offer um I think investing
more in that and understanding what super fans 
of our products really want and need is part of
what we talk about every day you know um I have a 
board meeting Thursday it's a part of our deck um
so we are actively thinking about that in every 
one of these vertical and building behind it um
so it's uh look it's not it's not done overnight 
this is always going to be something that took a
little while to to get everything right um and 
we're you know look we we also we have the kind
of team that there are two types of people there 
people who are like they see this possibility of
turning Yahoo around and where this could get 
to and and the brand and they run towards the
fire and they want to be part of that and they 
they would be proud to be part of that outcome
and there's people who are more conservative and 
don't that's not for them um it really is a ro
Shad test between the two types of people as as 
we're recruiting people in here um but our team is
super energized behind all that and um and working 
like crazy to to do it so as we've been talking
I've been thinking about something that you said 
like I don't know 15 minutes ago and I can't get
out of my mind which is that when you apply AI 
in search you can have like normal search results
and AI generated search results so I'm just kind 
of curious to hear from your perspective because
you know you also mention that you're private 
like you can you have some leeway to try some
things and and you know potentially even say all 
right we're going to lose some money in the short
term to try to make a better product whereas like 
something like a Google doesn't have that leeway
right that's been like the innovator's Dilemma for 
them how do you choose when to do generative AI
versus traditional search um and in which which 
use cases do you is it sort of dynamic is it a
percent you roll out like talk us through that 
decision I love it it's um it's funny I always
used to say because you know that whatever 15 
20 years ago there was only search I mean it was
such the the heart of the game pre-social media 
pre-mobile remember when I got to CBS Interactive
in 2011 only 6% of our traffic was mobile it was 
just so early for so many of these things and so
everybody had an opinion on search and I would 
always think it's so easy on your side of the
search box if you think about what we're dealing 
with on this side and all the different things we
have to do to get your answer right in the blink 
of a second um or to give you the right resources
or to give you related searches to you know uh uh 
to iterate in your query like all these things so
I I I automatically just in my product nerd side 
just go to that it's it depends on the query and
that's going to unleash a different tree structure 
for for what you might present present and what
you might do that as You Follow that thing down 
your n it's just continues to evolve and um and
again I you know the the the fact that someone 
would spend 21 minutes on perplexity versus just
trying to get to a a na a navigational query is 
one example or a quick answer what time it is
what's the weather how does perplexity work um as 
another sports scores is being one or you know the
history of something is another or or it's just it 
is all different and I just look at generative AI
as another tool to deploy this is clearly whether 
it's Bing or chat gbt Standalone or perplexity
Standalone with hitting all the databases they're 
hitting or now Apple and Google and how they're
going to do it they're all going to be doing that 
the same way and so for some theories it is just
generative Ai and for some it is just a link 
in every version in between how difficult of
a product problem is that to be like we basically 
you're guessing the intent of the user you're like
this user probably wants a generative AI answer 
versus this user wants 10 Blue Links how difficult
of a product problem is that and have you made 
any progress on solving it it gets easier the
more queries you have um and so we we actually 
own the patent that uh back in the day at ask
of uh uh you you know user Behavior algorithms um 
and uh and so that was a deep part of our search
results at the time and how we decided what to 
present to you and so it always gets easier if
you can relate this query to that query espe and 
then if you know the user you know it gets easier
as well so I do think scale really does matter um 
for that um do you anticipate this is going to be
the way that that all search engines handle this 
because it sounds like a pretty novel solution
go ahead I think the challenges cost that's one 
these are very expensive uh answers to generate
over time how much more does it cost to generate a 
generative AI answer versus a normal search answer
uh you you all know the answer 20x I don't know 
what what the what the real answer is it's out
there somewhere I know it's a lot more um so uh so 
yeah I mean I clearly look it's already happening
everybody's already decided it to your point and 
Brad gersner Point I've I've seen to make a lot
um you know their their their margin is is someone 
else's opportunity and and I'm sure that's going
to be a part of the Dynamics of the category I 
think you know we're not we're we're not in in
that situ ation and and one of the things for me 
is focus and and I can just focus on what I can
control here um where deploying those things and 
service of the user is is a no-brainer are you
definitely going to do this with Microsoft or are 
you thinking about building something on your own
I think it depends on um on what category you're 
talking about so we're talking to everybody and
considering all options we have a very deep 
partnership with Microsoft so there's a lot
we will do with them as well cool yeah r I have 
to I have to ask uh Jen Z the Next Generation how
do you pitch the Yahoo brand experience to you 
know the next uh whether it's a pool site.net
South by Southwest party but but I think at a 
higher level like especially because that idea
of a destination or a portal is so foreign unless 
it is you know an endless scrolling feed or social
network and typ app like what's the Yahoo pitch to 
the Next Generation again I don't think you start
with portal and I'm not even sure it gets back to 
that I'm not even sure that's the right exact way
to phrase what the end goals should be I think it 
it should be you know how can we help you achieve
your goals with as much value added as possible in 
both uh maybe anticipated ways and unanticipated
ways to help you do it as fast as possible to make 
you effective that will transform into you know
including using AI into all kinds of ways that 
we'll deliver that where we're starting from this
is where you know Alex teased me for saying we're 
being humble about it but it's enough to be uh
this size top five Internet Property with you know 
this level user base with with being number one or
number two in these categories that we get to nail 
or otherwise people will be coming after us in
those categories too if you do a great job at that 
I think it always opens up other doors for where
you go and to the point on gen Z I definitely you 
know it's interesting it's um we're not as well
known to them for sure but that depends on the 
category you you'd be surprised how balanced the
user base of Yahoo finance and Yahoo sports are 
right because we're you know a lot of people's
favorite fantasy platform and we're definitely the 
uh you know the Bloomberg for the retail investor
essentially right and so uh I mean the the number 
of and so that hits every age group um so you know
we're starting from a better spot than you would 
think with that but clearly you know that's part
of the road map ahead for where we have to get 
to I think uh for listeners who were not around
during the time ask geves which we've been talking 
about I had to look it up just to remember it the
logo was a butler like an old timey British 
Butler holding his hand up serving the answer
I think that's what's needed to bring back a to 
introduce it to the next Generation we we actually
moved on from Judes in 2006 Butler was no more 
he was it became just as after I it be he went
away although he came back in the UK later um and 
we threw a party at the at the big search engine
conference they used to throw where we froze 
him in carbonite like Han Solo had Darth Vader
walk him in with storm Trippers and it was it was 
pretty funny but um but yeah I mean that was very
you know that was founded in 1996 and it was an 
early days but again there were probably 10 public
companies that were search engines in the in the 
web 1.0 boom and we were the only ones to make it
through that wasn't Google you know Microsoft or 
Yahoo um rest in peace lios a lot of things right
lios Al Vista yeah yeah well it's funny is we now 
own that soand the brands that are under that were
inherited that weren't you know Netscape alter 
Vista uh uh ink you know ink to me I mean you
you'd be surprised the number of brands are are 
actually buried somewhere inside this company
from that era all right Ronan you got anything 
else anything else sorry I just add to ask once
more the butler the butler was in carbonite and 
walked out by Darth Vader and the Stormtroopers
did I have that correct because then you could 
always uh unfreeze him 2000s 2000s internet wild
times 2006 2006 yes I'm sad I missed that sounds 
like a good party yeah all right Jim so great to
having you thank you for swinging by thanks for 
all the insight and uh hope to speak with you
again soon okay see you later thank you all right 
everybody thank you so much for listening this
week on Friday ronon's going to be in France he's 
actually there now so uh but Reed albergotti is
coming on to co-host the Friday show so stand by 
for that se for technology editor Reed albergotti
will be breaking down all the week's news and we 
will see you next time on big technology podcast