Did Yahoo know (and tell us) that Google would report a positive surprise? We now know that concerns about Google's growth and monetization (on the whole) were a bit overblown after Google reported strong earnings significantly ahead of expectations after the market closed on Thursday April 17th. (My discussion in a previous post that better monetization would offset lower clicks was partially right. It seems paid click growth rates did not fall as much as the market had expected though.)

I remember thinking on Thursday during the day that it was strange that Yahoo chose to disclose on that particular day that they "were close to an outsourcing deal with Google". In fact, on that day before Google reported, Rob Hof at BusinessWeek.com wrote:

"Oh, please. An initial test of outsourcing Yahoo’s search to Google showed positive results, according to an account in the Journal. Hold it; didn’t that test just start this week? Wasn’t it supposed to go two weeks? Didn’t we already know that Google ads work better than Yahoo’s?"

He goes on to discuss why Yahoo might have done it early in the context of Microsoft, and of course it makes sense.

But here's what I'm trying to get at: Yahoo could have waited a day. If the Google earnings were strong, they could have pushed the story to the next day, and that would have been fine I think. If the Google earnings were weak, they could have waited, or done it anyway, or messaged it differently or any number of things.

It seems that only possible benefit of doing it that day before Google reported, instead of waiting, would be if you knew that Google would beat.  ¶ Saturday, April 19, 2008 0 comments links to this post