Microsoft Confirm Qi Lu as Kevin Johnson Replacement

As predicted by Kara Swisher in AllThingsDigital this morning, yt’s just been announced that Microsoft has replaced Kevin Johnson with Qi Lu and that Brian McAndrews is leaving.  It’s also been announced there is shuffling underneath, which on the surface the most interesting looks to be the Global Advertising Sales and Services organization moving into a more centralised position.

On initial thoughts, AdViking thinks that in choosing Dr. Qi Lu, Steve Ballmer has made an inspired choice.  I mean, the general chatter was about a business/market guy was going to get the job and then they appoint a well regarded Search-technologist (20 patents, etc.).  So in terms of Microsoft culture, this guy is going to walk in and the Office and Windows teams are going to be giving him props.

Now if you mash that up against the FAST and Powerset acquisitions, the European Search Center, etc. it’s great to see the effort that is being made to try and take the game to Google.

Generally response looks to be positive but Henry Blodget at Silicon Alley Insider provides a good outline on the width of the group that Qi Lu is inheriting and therefore highlights some of the issues.

Here’s the full Press Release:

Microsoft Appoints Dr. Qi Lu to Run Online Services Group

Yahoo! veteran to oversee Internet offerings for consumers, advertisers and publishers.

REDMOND, Wash. — Dec. 4, 2008 — Microsoft Corp. today announced that Dr. Qi Lu will join the company as president of the Online Services Group. Dr. Lu will lead Microsoft’s efforts in search and online advertising and all the company’s online information and communications services. Dr. Lu will report to Microsoft Chief Executive Officer Steve Ballmer.

Lu most recently served as executive vice president of Engineering for the Search and Advertising Technology Group at Yahoo!, where he was responsible for development efforts around Yahoo!’s Web search and monetization platforms. Dr. Lu left Yahoo! in August 2008 after 10 years of service.

Dr. Qi Lu will join Microsoft as president of the Online Services Group effective Jan. 5, 2009.

“I am tremendously excited to welcome Qi to Microsoft,” Ballmer said. “Dr. Lu’s deep technical expertise, leadership capabilities and hard-working mentality are well-known in the technology industry, and Microsoft will benefit from his addition to our executive management team.”

“I am genuinely excited about the opportunities ahead for Microsoft to make an enormous impact on the online industry,” Dr. Lu said. “Microsoft has built a great foundation for its search and advertising technologies and put an amazing team of researchers and engineers in place to drive the next wave of innovation in online services. I’m looking forward to working with them to help transform the way people and businesses use the Internet to find and share information.”

Before his most recent role at Yahoo!, Lu was vice president of engineering responsible for the technology development of Yahoo!’s Search and Marketplace business unit, which includes the company’s search, e-commerce, and local listings of businesses and products.

Before joining Yahoo! in 1998, Dr. Lu was a Research Staff Member at IBM Almaden Research Center. Before IBM, Dr. Lu worked at Carnegie Mellon University as a Research Associate, and at Fudan University in China as a faculty member. Dr. Lu holds 20 U.S. patents, and received his bachelor of science and master of science in computer science from Fudan University and his Ph.D. in computer science from Carnegie Mellon University.

Lu’s first day at Microsoft will be Jan. 5, 2009. In his role running the Online Services Group, he will oversee several groups including the Advertiser & Publisher Solutions business, managed by Scott Howe who was promoted to corporate vice president; the Online Audience business, managed by Senior Vice President Yusuf Mehdi; OSG Research & Development, managed by Senior Vice President Satya Nadella; and OSG Finance, managed by Rik van der Kooi who was promoted to corporate vice president.

With the successful integration of aQuantive now complete, Brian McAndrews, former CEO of aQuantive and senior vice president of Microsoft’s Advertiser & Publisher Solutions Group, has decided to transition out of Microsoft, and will do so over the next several months, serving in a consultative capacity to Steve Ballmer and Qi Lu during that time.

“Brian McAndrews built a world-class business for advertisers and publishers and led the successful integration of aQuantive into Microsoft, setting the foundation for our next phase of growth,” Ballmer said. “While I am sorry to see Brian leave the company, I respect and understand his decision and wish him nothing but the best in the future.”

“I also want to congratulate Scott and Rik on their well-deserved promotions and look forward to their leadership in the Online Services Group alongside Qi, Yusuf and Satya,” Ballmer said.

As part of today’s announcement, several teams will move to further align resources. The field sales organizations in the Online Services Group will move to Microsoft’s centralized Sales, Marketing and Services Group led by chief operating officer Kevin Turner. This group, called Consumer & Online, will be led by Corporate Vice President Darren Huston and will include the Global Advertising Sales and Services organization, led by vice president Bill Shaughnessy.

Also, though it doesn’t say much more than the PR you can read the Steve Ballmer  internal announcement that was  leaked on TechCrunch.

Disclosure: Some of AdViking is employed by FAST and Microsoft.  More details on About.

Google May Have Changed the Search Game (again)

AdViking is learning not to be to effusive about the efforts coming out of Google Labs but if the SearchWiki approach gets traction then I think they have done it again.

More details below but basic premise is that someone with a Google account can control their results set now by ranking, removing, adding notes and see what changes other users have done.

If this gets traction then this could be really big.  Think about all the additional data that Google is gathering here to improve their search results.  Forget semantic or the team of paid editors they have running, this is pure crowdsourcing.

By that, let’s say a search for Good Coffee brings back 10 results.

Of those 10. 2 people don’t bother to do anything.  8 changes things around.  Let’s just say that 5 people remove Starbucks from the top 10 list here…well than naturally this is a worthwhile improvement to be considered by Google.

Man, imagine what this is going to do to SEO.  And this quickly could rise to a whole new way of gaming the system…

RWW asked the Inventor of the Wiki what he thought and amongst other things, he says this:

They are going to get a lot of data. They obviously have the ability to wield information, let’s just hope that we will all benefit. I don’t think it’s obvious that we all will benefit – but I guess I have enough trust in the behavior of a large number of people.

For sure one to ponder, play around with and see what the impact is.

Here’s what they say about it:

Customize Your Search Results with SearchWiki

Google users now have more control over their search experience, thanks to our newest addition to Google Web Search: SearchWiki. With this new set of features, users can add, delete, re-sort or comment on search results for any query, to create a set of search results that’s customized just for them.

Just do a web search when logged in to your Google account, and check out all the new tools that are available. Now you can reorder results so that the site you prefer always appears first, delete a link from the search results that seems out of place, add a url so your favorite site always shows up for that search, or post a comment so you can remind yourself about a page’s content or provide recommendations to other users doing the same search.

These notes will only affect your search results pages and do not impact the ranking for other users when they search on Google. But to see even more information about what other users think about a search, check out the “All notes for this SearchWiki” link, which lets you see an aggregated view of which pages have been moved up, deleted or added, as well as the comments users have added for specific sites.

Here’s a video of it in action

Google Waves Yahoo “Google-bye…”

Exit Stage Right?

So, the mega ‘deal’ that Yahoo! struck with Google to get Microsoft off its back has backfired, or if not backfired, at least ‘back-burnered’. Adviking is not one to miss a chance to get on a soapbox, however before we crack open the bubbly  and mull over anti-trust issues of market dominance… we can’t help but feel, regardless of press releases and articles to the contrary, that it leaves Yahoo! on the sidelines and Google smirking at the flimsiness of the competition.

Will Microsoft return to the table? They envy the Yahoo! search traffic for sure, but as Social Media starts to gain more leverage and prominence, will Yahoo! properties lose their lustre somewhat? Their mail app is generally considered to be class-leading (much to Google’s chagrin), but what else have they got?

We can’t help but feel that this will be the case… Google got the Yahoogle out of there and has abandoned ‘Junior’ and, for all the credibility Jerry Yang has left, it can only be a matter of time before there are more movements in this space.

As always, we’ll be watching. In a few years will Yahoo! be Ya-who?

blinkx Make a Run at Miva

 

blinkx have announced they have made a $41 million cash offer for Miva, which represents a 54% premium above the $0.78 closing price of Miva stock yesterday.  As Miva has $20 mill cash in the bank, as this price blinkx would actually only be paying $21 million.

Miva was a combination of eSpotting and FindWhat and at one time would have been considered by a few as being on the edge of getting into the Premiership of PPC ad networks.

Latest

Miva have turned down the unsolicited offer but with Miva announcing their Q2 results today, AdViking states the obvious and say’s it’s only a matter of time before this deal is done.

Miva announced their Q2 results on Monday.  Revenue was $30.2m for the quarter, down from $32.7m year on year.  Which was a EBITDA loss of $5.2 million.  And cashflow dropped down to $17.2 million.

Why Should I Care About this Deal?

On the surface (e.g.:  Miva announcing staff cuts), this could just appear some consolidation but few points make it interesting.

blinkx are a British company, spun out of Autonomy, and to date are considered a video play (video search engine and contextual video advertising platform).  Cross-Atlantic traffic going from the Old World to New is a bit different and thankfully (and this is good based on what AdViking has heard from Miva insiders about the state of the Miva technology), PiperJaffray analyst Rajeev Bah also thinks this is about getting in some additional revenue and advertisers from a pure-Search network.

Blinkx’s proposed bid for Miva has the potential to significantly change the shape of the business, marrying Blinkx’s advanced search and ad-matching capabilities to Miva’s material base of search-based advertising revenue

For a lot of people (like AdViking contributor and ex-eSpotter, A Fuller View on the Miva Blinkx Deal and Motley Fool’s Rick Aristotle Munarriz) who have been following the fall from great height of Miva since 2005, having this deal done will bring some needed closure.

Offer Letter

Here’s the offer letter:

August 8, 2008

MIVA, Inc.
5220 Summerlin Commons Boulevard
Suite 500
Fort Myers, FL 33907
Attention:     Peter Corrao, CEO
Larry Weber, Chairman
Members of the Board of Directors

Dear Ladies and Gentlemen,
Re: blinkx and MIVA Combination

I am writing on behalf of the board of directors of blinkx Plc to make a proposal for the business combination of blinkx and MIVA. Under our proposal, blinkx would acquire all of the outstanding shares of MIVA common stock for $1.20 in cash per share. Our proposal is not subject to any financing condition. The transaction would be funded from existing cash resources of the two companies.
Proposal. Our proposal represents a 54.0% premium above the closing price of MIVA common stock of $0.78 on August 7, 2008, and a 36% premium over the average closing price for the one month prior to August 7, 2008.
By whatever financial measure one might use, we believe this proposal represents a compelling value realization opportunity for your shareholders and the quickest and most secure way to see such value, particularly given the several challenges MIVA faces in the near term, including: risk and cost associated with the new technology platform, a deteriorating cash position, continued deterioration of the Media EU business and continued decline in revenue and profitability.
We believe that MIVA’s shareholders would not be well-served by any delay in negotiating or completing the merger process, and that time and/or another round of restructuring plans will not significantly increase MIVA’s valuation.
Background. Having worked together for a number of years you will be aware that blinkx is the world’s largest and most advanced video search engine. Founded in 2004 by Suranga Chandratillake, the company completed a successful IPO on the London Stock Exchange (AIM) in May 2007 and currently has a market capitalization of approximately $160 million, with headquarters in San Francisco, CA and the UK. With an index of over 26 million hours of searchable video and more than 350 media partnerships, including national broadcasters, commercial media giants, and private video libraries, blinkx has cemented its position as the premier destination for online TV. blinkx pioneered video search on the Internet, enhanced by $150 million in R&D over 12 years, and is now protected by 111 patents.
Rationale. blinkx believes that a combination of the two companies would be mutually beneficial to both companies’ shareholders, employees, and customers. blinkx and MIVA have complementary businesses that could benefit greatly from blinkx’s technology and MIVA’s distribution network.
blinkx has worked with MIVA as a customer and partner for a number of years and has a great deal of respect for MIVA’s success in building a global keyword advertising network and growing the MIVA Direct consumer offering. We believe, however, that with the Internet’s continued progression towards rich media and newer forms of advertising, more advanced technology will play a fundamental role in achieving success.
blinkx already has in place a proven and growing video-driven revenue engine, and enjoys an unrivalled technology portfolio which is applicable across many aspects of the online market. A combination of the two companies – fusing MIVA’s advertising network with blinkx’s ability to leverage its technology portfolio into the online market – presents an exciting and compelling opportunity.
Specifically, blinkx’s advanced and scalable matching technology will enable immediate platform improvements for MIVA. As a result large portions of relevant search traffic from MIVA’s search ad network will be monetizeable at higher rates through blinkx’s technology. Furthermore blinkx’s technology holds the potential to build on MIVA’s existing toolbar network, adding the latest functionality and an entirely new revenue stream. Finally, MIVA’s consumer sites and portals, that already attract large audiences, will immediately benefit from blinkx’s advanced video technology and AdHoc advertising platform.
Process and Employees. We would value the opportunity to further discuss with you how to optimize the integration of our respective businesses to create a leading global technology company. We believe that the management and employees of MIVA are critical to realizing a successful transition and foresee an important and central role for MIVA employees in the combined company.
Any acquisition of MIVA would be subject to the opportunity to conduct a limited confirmatory due diligence investigation, the negotiation of a definitive merger agreement containing customary terms and conditions, including customary conditions to closing; no material adverse change to MIVA’s business; appropriate shareholder approvals; and any regulatory requirements. Given our participation in the industry and MIVA’s public status, we envisage an efficient due diligence process appropriate to a public company. We are prepared to deliver a draft merger agreement to you and begin discussions immediately.
Due to the importance of these discussions and the value represented by our proposal, we expect the MIVA Board to engage in a full review of our proposal and discussion of its contents with MIVA’s shareholders. We are prepared to meet at a time and location of your convenience to complete due diligence and commence definite agreement negotiations.
We believe this proposal represents a unique opportunity for MIVA’s shareholders to realize value, and the combined company will be well positioned for future growth. We hope that you and your Board share our enthusiasm, and we look forward to a prompt and favourable reply.
Yours sincerely,
Suranga Chandratillake
CEO and Founder

This communication does not constitute, or form any part of, any offer for, or any solicitation of any offer for, securities or the solicitation of any vote for approval in any jurisdiction

Livebloggen: Yahoo! Annual General Meeting 2008

Well, AdViking doesn’t have the budget to attend the Yahoo! Annual General Meeting but that doesn’t stop us from trying to follow the action from the comfort of living rooms with beers in hands…

Actually that sounds better than attending.

17:48

Early build up coverage doesn’t have must to say, but Kara Swisher has confirmed the pastries are looking good…

Here’s some promising links to follow the coverage so far:

• The Times of London
• AllThingsDigital
• Mercury News
• PaidContent
• CNet
• The official webcast

18:22

The Mercury News link above is providing live transcript.

There’s 5 Shareholder Proposals.

Most interesting is that exec pay is out of whack.

Funniest, but totally not is about Yahoo! issues with human rights.  One guy re-quotes something about Y! mgmt being “moral pygmies” – Response being that quote is an insult to pygamies and the because of the issues in China, that Jerry Yang should enjoy his visit to the Olympics.

18:30

Some peanut gallery comments about the Plumbers Union who wanted the pay review.

Y! opposes Human Rights, Pay Review and Censorship Review Shareholder Proposals.

18:44

As Ballmer would say, blah blah blah…whatever guys.  You had this amazing strategy and Microsoft got in your head and you did a deal with Google that will kill your business.

Updated link:  CNET

18:56

Yang giving the update…we’re in transition, etc.  we got a lot of assets, can make money, etc…trust us…but dude what about Google…dude what about all the real smart people who just walked out the door

19:19

Enough of the updates, let’s get to the questions…or should I say fireworks

20:01

The Q&A is great…living up to the hype…

20:41

On reflection, it didn’t really….some great quotes and some interesting Shareholder Proposals but nothing really that persuasive from the Y! board as to why they should keep their jobs.

AdViking will have a ponder and come back with a summary.

Microsoft Announces Live Search Deal With Facebook

AdViking actually thinks that with all the news breaking in the industry at the moment it’s probably just easier to move to micro-blogging…might look into how to pull Twitter into WordPress.

Anyway, during Analysts Day in Redmond, Microsoft announced that it would be providing Live Search and Ad Center ads in the SERP to Facebook.  Deal is only for the US site.

Facebook currently doesn’t offer a web search so no real idea of what the volumes will be.  What’s interesting is that  Facebook will be getting the API to then build layers on top, kind of like a bespoke BOSS for one the high traffic Publishers.

It’s also pretty nifty when you consider the Powerset purchase by Live…think semantic mashup with a decent index and heavy, I mean heavy social graph clickstream influencing of the results.

AdViking asked UK social media pundit and Facebook Developer Garage London host, Toby Beresford for his comment:

I think Search is really important addition to the Facebook experience. It’s just too difficult to find stuff at present.
What’s most interesting for me is their opportunity for more sophisticated searches, along the lines of that envisaged by the semantic web, find me the John Smith who is a lecturer at Kings College for example. Or perhaps all brand pages for cinemas near where I am now that are showing The Dark Knight…

Seems like AdViking and Toby are on the same page here and let’s hope for some exciting revolutions of the Search flywheel on the back of this deal.

Microhoo Fallout? Kevin Johnson Leaves Microsoft

In a surprise move, it was announced yesterday that Kevin Johnson has left Microsoft to become CEO of Juniper Networks.

Johnson was the driving force behind the run at Yahoo! and was head of the Platform & Services Division, the largest group at Microsoft, containing Windows, Live, Advertising (APS) and a few other things.

Debate around the why, what, etc. of this is pretty split, e.g.:

TechCrunch are positive, Microsoft Rumbles, Rearms For Online War It Can’t Win Without Yahoo

Though Kara Swisher (no surprise here) comes down on the negative side:  Microsoft’s Latest Web Stumble: Kevin Johnson Out

Why Did He Leave

AdViking believes that the run on Yahoo! is a (defensive) tactical play to ramp up the Search side of things and protect Windows and Office revenues (i.e.:  the part of the Cloud War rather than the Search Battle).

This run currently looks like it was a failure and some of the moves that were taken looked ill-conceived and the impact was that Ballmer and Microsoft currently look like they have egg on their faces.  The price to pay for this is that Kevin Johnson is leaving.

The Impact

The immediate impact is that they have now split Johnson’s empire into two groups:

• Windows/Live – Reports directly to Ballmer
• Online Services Business – The search is on to fill this gap.  This fact is surprising and a clue to the fact this was an unplanned exit.

Picking up on the point that there is no-one in place to head up the Online Services Business, an interesting echo from the sphere is that this could possibly leave room for an acquisition CEO to fit into a key role nicely (e.g.:  Jerry Yang)

AdViking thinks this split makes a lot of sense and from looking at the Org chart before yesterday, didn’t quite understand why two such important groups rolled up under one Exec.

AdViking further likes the split as it does mean that the advertising side of the business will now have more power and therefore will be able to offer the industry an even more competitive offering.

Background Materials

Official Microsoft Press Release

News of the departure and re-org was announced in a few ways including a 2009 Strategic Update email from Ballmer.  This has had wide coverage in full text.

Some interesting tidbits to pull-out from these:

Betting on Display Advertising

Senior Vice President Brian McAndrews will continue to lead the Advertiser & Publisher Solutions Group (APS)…McAndrews will continue to focus on the display advertising opportunity for Microsoft

Google and Search

We continue to compete with Google on two fronts—in the enterprise, where we lead; and in search, where we trail. In search, our technology has come a long way in a very short time and it’s an area where we’ll continue to invest to be a market leader. Why? Because search is the key to unlocking the enormous market opportunities in advertising, and it is an area that is ripe for innovation. In the coming years, we’ll make progress against Google in search first by upping the ante in R&D through organic innovation and strategic acquisitions. Second, we will out-innovate Google in key areas—we’re already seeing this in our maps and news search. Third, we are going to reinvent the search category through user experience and business model innovation. We’ll introduce new approaches that move beyond a white page with 10 blue links to provide customers with a customized view of their world. This is a long-term battle for our company—and it’s one we’ll continue to fight with persistence and tenacity.

On the Yahoo Run

…I want to emphasize the point I’ve been making all along–Yahoo was a tactic, not a strategy. We want to accelerate our share of search queries and create a bigger pool of advertisers, and Yahoo would have helped us get there faster.