Long tales and other good reads

So things have been good. Been reading a lot of good reads lately. Few of the really good ones for your perusal & consumption below:

Chris Anderson's Book - The Long Tail
I know, I know i'm behind the curve on this one. The Long Tail: Why the Future of Business Is Selling Less of More (2006) by Chris Anderson, the Editor-in-chief of wired magazine (the favourite read of this blog) is a stellar book and must be read by everyone who is remotely interested in economics. Yes Economics and not just the internet. Anderson in this book talks about the remarkable manner in which the internet has re-written traditional retail that focussed solely on "hits" due to the constraints of supply chain and inventory costs. The main focus is on how, due to the internet, the market is moving towards the "non hits" as people are moving from mass consumer products to more customized niche products.

I knew about the Long Tail theory pretty much when the book released but this book has given me an insight on Search Engines that I never noticed before. The sieving quality of search engines to negotiate all the clutter on the net.That, methinks, is the saviour of the long tail. Yes there is significant choice out there thanks to the internet and the availability of information. But choice is useless unless you can get to it. Search Engines sift through the internet to get you what you want. That's why a Search Engine on the web portal is crucial.

Most companies do not pay attention to the search engines on their own web portal because they think their own portal is a small universe and people will get to the content any way. But regardless, navigating any portal can sometimes be overwhelming. I personally hate it when search queries within a site don't work and give out odd results. Especially when its at odds with Google. The big takeway for me personally from this book was that marketing to the long tail because of its niche drive preference is going to be difficult and sometimes not feasible but if one has an elaborate website, investing in good search engine technology and a recommendation alogorithm will ease things up significantly.

One of my favourite lines in the book tho, is when he describes Fiona Apple as "Delightfully Unhinged". I'd like to wear a T-shirt that says that! More on the book here. Also read the Long Tail blog here

There's a blogging exchange of words going on in Harvard Business Review between Chris Anderson and Anita Elberse, a harvard prof. Elberse is arguing on if one should take the long tail seriously and invest in it. Its an extremely good read and besides its greatly stimulating to see two intellectuals argue. Register on the HBR site and you'll get access to it. Can't link to it unfortunately :(

More shameless Wired Plug Alert
Yes well, what can I say I'm like a wired groupie these days. Wired is celebrating its 15th anniverssary this year and because of that one is able to access a lot of past gems. I chanced upon a wired article on the landmark US Vs Microsoft anitrust case. Th article, all of 45 pages, was published after the judgement to break up Microsoft was delivered in 1998. The article brilliantly narrates the events leading up to the case and gives inside scoop on all the players involved especially the Department of Justice (DoJ) and Microsoft.

The article reads like a salacious saga and is completely absorbing. Besides that it gives one valuable insights on US anti trust laws. By the end of this article, one gets to know the Sherman Act better than one's right hand. You also get know the ugly side of Microsoft. I'm not sure if the article was particularly biased against Microsoft but its not flaterring in anyway. I don't really get why people in tech hate microsoft so much. It may be vehemently dominating and they may not make the best of products but hey nobody out there has an OS that matches Microsoft. I use MS products evryday and I don't think I should crib particularly when I have not seen a better product to rival it. Read the article here

This made me wonder if India has Antitrust laws? Anyone know? Also I don't particularly think its a good idea, not right now any way. We've just become a free economy, what we don't need right now is a regulatory law. Besides, the ambanis and tatas of this country would never allow it

*end shameless plug*

More bounty
The Economic times recently had a great article on Leadership. In an article called "Four fundamental laws for CEOs racing against time" the author, with good examples, illustrates the 4 guiding principles that CEOs, who are pressed for immediate results, should adopt.

Another article in ET talks about the importance of customer advocacy. The author makes the case about why one should always invest in building a loyal community of users as the latter could come to the rescue during bad times. Read the Article here

Only to come running back again

Just when I thought that the internet had just gotten entertaining with the delicious prospect of MicroHOO!, balmer, the original Monkey Man(watch this if you don't believe me) has gone and pulled the rug under Yahoo. Not surprisingly the latter's share price dropped an amazing 14% after the pull out. Well most people think its a ploy to put pressure on Yahoo! through its shareholders. That's the general view anyway, that Microsoft will eventually bid again but at a lower price. Well that's how his letter to Jerry Yang looks. Well here below, the letter in all its awesomeness.(I'm kidding ofcourse, about the awesomeness I mean, I prefer his inspirational speeches anyday, Balmer not Jerry Yang)

Dear Jerry:
After over three months, we have reached the conclusion of the process regarding a possible combination of Microsoft and Yahoo!. I first want to convey my personal thanks to you, your management team, and Yahoo!'s Board of Directors for your consideration of our proposal...

I am disappointed that Yahoo! has not moved towards accepting our offer. I first called you with our offer on January 31 because I believed that a combination of our two companies would have created real value for our respective shareholders and would have provided consumers, publishers, and advertisers with greater innovation and choice in the marketplace. Our decision to offer a 62 percent premium at that time reflected the strength of these convictions.

In our conversations this week, we conveyed our willingness to raise our offer to $33.00 per share, reflecting again our belief in this collective opportunity. This increase would have added approximately another $5 billion of value to your shareholders, compared to the current value of our initial offer. It also would have reflected a premium of over 70 percent compared to the price at which your stock closed on January 31. Yet it has proven insufficient, as your final position insisted on Microsoft paying yet another $5 billion or more, or at least another $4 per share above our $33.00 offer.

Also, after giving this week's conversations further thought, it is clear to me that it is not sensible for Microsoft to take our offer directly to your shareholders. This approach would necessarily involve a protracted proxy contest and eventually an exchange offer. Our discussions with you have led us to conclude that, in the interim, you would take steps that would make Yahoo! undesirable as an acquisition for Microsoft.

We regard with particular concern your apparent planning to respond to a " hostile" bid by pursuing a new arrangement that would involve or lead to the outsourcing to Google of key paid Internet search terms offered by Yahoo! today. In our view, such an arrangement with the dominant search provider would make an acquisition of Yahoo! undesirable to us for a number of reasons:
First, it would fundamentally undermine Yahoo!'s own strategy and long-term viability by encouraging advertisers to use Google as opposed to your Panama paid search system. This would also fragment your search advertising and display advertising strategies and the ecosystem surrounding them. This would undermine the reliance on your display advertising business to fuel future growth.

Accordingly, your apparent plan to pursue such an arrangement in the event of a proxy contest or exchange offer leads me to the firm decision not to pursue such a path. Instead, I hereby formally withdraw Microsoft's proposal to acquire Yahoo!.

Thank you again for the time we have spent together discussing this.

Now to learn what he really meant in his letter, read this hilarious take

MicroHOO! update - Microsoft Very Quiet, but Something Is Happening

A superb article on Wired.com on the Microsoft -Yahoo merger. The industry has appropriately termed it the MicroHOO! affair. Well this article looks at the future scenarios that could pan out and methinks this is an excellent insightful review on the pains of M & A between two industry giants with such an acrimonious history. Surely, this is a business school case study in the making (hehehe)

The various case scenarious have been aptly analyzed - what if a higher offer is made or a hostile takeover is done or if Microsoft walwaks away altogether and finally if Microsoft sticks to its half cash, half stock bid. the winners, losers and what would happen next have neatly analyzed.

My two cents on this whole issue:

1. Its going to be very painful. 2 big monoliths have never merged successfully and there are going to be tonnes of integration problems not to mention the basic cultural issue - silicon valley start up (Almost) meeting seatle software big daddy. ouch, it feels painful

2. The big winner in all this is going to be Google. Ironically, the big G is the reason why Microsoft made the offer

3. M & A's are successful only when there is very little overlap between the businneses of overlapping companies. MicroHOO! has way too much overlap and this could also pose a lot of painful issues on what products need to be jettisoned, thus leading to alot of internal strife. I wouldn't want to be in on a meeting between the product heads of MSN and Yahoo Messenger. Actually I would.

4. Microsoft has no choice but to go ahead with this merger if it ever hopes to steal a march from google and Yahoo has been in a limbo due to various internal issues. The basic issue - both Microsoft and Yahoo need each other but really cannot stand each other. If they merged, it would make for an entertaining Marriage.

5. And oh, lets not forget Microsoft's Anti-trust issues. With both of MicroHOO!'s instant messaging systems, email services, web portals, I bet the Justice department is rubbing its palms in glee (being egged on oh so subtly by Google) oh what fun!

6. Like I said before, The only person gaining out of this hooplah is Google. They'll get all the great, creative Yahoo folks due to mass exodus and all they had to do was stand on the sidelines!
I read somewhere, that inorder to stir things up a bit and raise Microsoft's hackles, Eric schmidt gave yahoo a call on how..er..may be they could work together on things. lol

Another good article on what makes for good M & A's here. M & A's work, as the article says, when both companies have unique but complimentary products on offer. That way the integration can be smooth and there is greater consolidation