Tuesday, July 17, 2007

I was struck this morning with a clear vision of the fundamental strategic battle going on among web technology businesses today. It allowed my to finally understand three often ignored oddities that I've had a hard time explaining away and I think provides a framework for predicting the endgame in this cycle of innovation.

Oddity #1 - Yahoo and AOL are still relevant.

Oddity #2 - Social networks duplicate their user's address books.

Oddity #3 - users ask social networks to spam them with notifications

Here's what I realized...computers even when networked are still information technology and webmail is *still* the killer app of the web, but the original successes (Yahoo, Hotmail, AOL and to a lesser degree Gmail) choose to fight a battle of attrition with each other rather than competing to be more killer. They've focused on spam, AJAXifying, storage...all interesting technical challenges that allow the people to email more efficiently, but they missed the opportunity to use new technology help people exchange information more efficiently.

Into that gaping hole stepped MySpace and Facebook, helping people keep up to date on each other's lives without the dreaded "mass email" (and at first without the fear of spam). They attached a face to every message. They reversed the spam problem, requiring consent/connection before allowing messaging. Conversation histories, co-messaging, subscriptions, the list goes on how MySpace and Facebook provided a more efficient, effective, and "safe" form of communication.

It is important to ascertain to what extent the email companies could have done these things. If the rumblings of secret social networking projects at Yahoo and Google are indication, a few months from now I won't need to answer this question,so I'll leave it until then. But let me note now that I believe the reason they didn't though they could is because email grew out of a standards based, universal world. I mean: what would the MIME type be for a "poke"? Social networks get around this problem by using the universal platform for as much as they could (the message notification) and confining the interesting stuff within their walled garden.

Let me be historically fairer, but more damning in the present. This almost happened to Yahoo and AOL before, but they pulled through. The interloper on email's turf as the communication tool of choice in 1996 was ICQ (I seek you) an Israeli company that provided "instant messaging" Luckily for AOL, they already had a product that could be re-purposed to create AOL Instant Messenger, and Yahoo was still young enough to internally develop their own competitor two years later. Five years ago they both added notification of email messages to the IM client and just recently completed the circuit by adding IM to the email client.

Whew! They can't take that long this time around. Facebook is a more formidable opponent than ICQ and less open to being bought. With the launch of the Platform, they've already leaped ahead to the next phase of communications development while AOL and Yahoo are still figuring out the current phase. But then again, old fogies like me still get almost all friend news via my webmail inbox, so Yahoo and AOL could at least stop the bleeding while they try to position for the end game: your personalized messaging first page.