I always wondered what had happened to Yahoo, which at one time was the Cinderella company of Silicon Valley. When I was teaching computer classes at the local college, I recall using the Yahoo story of success as an example of how one company took full advantage of the Internet,   Something happened to Yahoo, which I had  believed was caused by the success of Google. But Bill Graham, a former Yahoo employee, shares with us his personal views why Yahoo really failed. This is part of what he stated:

One obvious result of this practice was that when Yahoo built things, they often weren’t very good. But that wasn’t the worst problem. The worst problem was that they hired bad programmers.

Microsoft (back in the day), Google, and Facebook have all been obsessed with hiring the best programmers. Yahoo wasn’t. They preferred good programmers to bad ones, but they didn’t have the kind of single-minded, almost obnoxiously elitist focus on hiring the smartest people that the big winners have had. And when you consider how much competition there was for programmers when they were hiring, during the Bubble, it’s not surprising that the quality of their programmers was uneven.

In technology, once you have bad programmers, you’re doomed. I can’t think of an instance where a company has sunk into technical mediocrity and recovered. Good programmers want to work with other good programmers. So once the quality of programmers at your company starts to drop, you enter a death spiral from which there is no recovery.

I think the real funny part is that Graham recommended to Yahoo that they buy a start-up called Google. He mentioned to his bosses that he and others from Yahoo were using Google search because it was better than what Yahoo offered. The idea was rejected since the thinking was that search was not a lucrative enough market to be bothered with.

This does make one wonder why Microsoft even to chose to partner with Yahoo. It doesn’t appear that Bing is doing any better with or without Yahoo as a partner.

Comments welcome.

Source – By Paul Graham