Good Read from ZDNet

Google rises at Yahoo's expense
By Elinor Mills, CNET News.com
Published on ZDNet News: April 23, 2007, 4:00 AM PT


The contrast between the financial results announced last week for the two top search engine companies couldn't have been more stark.

Yahoo's first-quarter revenue was $1.67 billion, less than half Google's $3.66 billion. Google, once again, blew away Wall Street expectations, while financial analysts openly wondered how long Yahoo CEO Terry Semel would stay in the Internet company's corner office.

Contrast those divergent fortunes with two years ago: The companies were pulling in about the same amount of revenue; they looked primed to battle for Internet domination; and the jury was still out on whether Google's largely unproven management had the chops to take on a seasoned pro like Semel, a longtime entertainment executive whose hand prints are on Hollywood's Walk of Fame.

Now few would argue the answer to that management question was, in fact, a resounding "yes."

"Google has a racecar. Yahoo has a Honda," said Stephen Arnold, author of The Google Legacy. "It goes back to the (search) algorithm, the engineering team and this constant improvement the Google people do. And I don't see any way to close the gap quickly."