BoomTown » privacy

Center for Digital Democracy's Jeff Chester Talks About MicroHoo and More!

Kara Swisher — Wed, 18 Nov 2009 16:55:03 +0000

While in Washington, D.C., BoomTown can’t just visit the policy wonks from Internet companies (such as my Facebook how-do-you-do here), so I hightailed it several hundred feet and directly across Connecticut Avenue NW to visit with Jeff Chester.

For those who don’t know him, Chester is the executive director of the Center for Digital Democracy, a nonprofit consumer advocacy group that works to promote privacy and protection online.

In other words, a professional–and much needed–thorn in the side of Facebook, Google (GOOG) and these days, MicroHoo.

That’s because, while advertisers and publishers are supportive of the massive search and online advertising deal between Microsoft (MSFT) and Yahoo (YHOO)–which now looks close to being launched–Chester has a more whoa-nelly attitude.

“There are questions that must be answered regarding the collection and sharing of consumer data by the two companies,” said Chester right after the deal was announced. “While the rationale for the deal is to provide some much needed competition to Google (and income for Yahoo), the further consolidation of the global digital advertising system should be a concern to Internet users, privacy advocates, online marketers, and competition regulators.”

Violations of consumer privacy by such unions or by Facebook’s efforts to use data to better deliver online ads or by any of the myriad ways such companies are honing their behavioral targeting skills worries Chester.

Thus, in patented D.C.-style, he hectors government agencies, politicians and the media to look more closely at such practices.

Here is my video interview with him about all this, which is well worth listening to, especially in an era when online powerhouses like Google are learning more and more about you, and not in a good way:

[ See post to watch video ]

Exclusive: Yahoo and Microsoft Poised to Finally Sign Definitive Search and Ad Agreement

Kara Swisher — Wed, 18 Nov 2009 08:01:27 +0000

Yahoo and Microsoft are poised to finally sign the definitive agreement that will govern the complex and far-reaching search and online advertising partnership they struck in late July, said sources close to the situation.

If all goes well, the various Microsoft and Yahoo execs–who have been ferreted away over the last weeks, busy dotting all the i’s and crossing all the t’s in the massive document–could even turn in their deal homework to their bosses for signature by the end of the week.

Yahoo (YHOO) officials declined to comment, while Microsoft (MSFT) has not gotten back to BoomTown as yet.

In any case, getting the definitive agreement in place is critical to making the high-profile MicroHoo deal a reality and, of course, getting the anti-Google (GOOG) party started.

So when the pair blew through a deadline to complete it in late October, there were eyebrows raised all over Wall Street and Silicon Valley.

When Yahoo filed an 8-K with the Securities and Exchange Commission in August, it noted that the “Definitive Agreement” between the Silicon Valley Internet company and the Redmond, Wash., software giant needs to be sketched out by Oct. 27, 2009.

But it is a monster document, which is why MicroHoo did not complete it in time. After that whiff, Yahoo said as much in another filing with the SEC:

“The Letter Agreement specified that the parties would execute definitive agreements by October 27, 2009, but given the complex nature of the transaction, there remain some details to be finalized.”

Added Microsoft similarly:

“We have made good progress in finalizing the definitive agreements. Given the complex nature of this transaction there remain some issues that need some additional clarity and definitive details.”

Nonetheless, both companies have consistently said that they would be able to close this deal by early 2010.

Yahoo and Microsoft had already done a pretty hefty binding-agreement letter (here is a picture of Yahoo’s CEO Carol Bartz and Microsoft CEO Steve Ballmer holding it, in fact).

Also key: Getting approval for the deal from regulators in Washington, D.C., which, sources said, also seems to be on track.

With little opposition, Yahoo and Microsoft policy types have been chipping away on regulatory issues with federal regulators in Washington.

And, several sources said, those government approvals are now nearing completion at the Justice Department, even though the Federal Trade Commission might still ask for more assurances on privacy issues related to online advertising and consumer data.

International regulatory approval is another story, especially in Europe, which could further delay the implementation of the partnership, since it is unlikely the pair would move forward without clearance globally.

When that is done, the real game begins, as MicroHoo faces its the much more critical Tim Gunn acid test for the deal:

Making it work.

Kara Visits Facebook's Washington, D.C., Office and Talks Policy!

Kara Swisher — Tue, 17 Nov 2009 13:02:13 +0000

Yesterday, BoomTown paid a visit to the Washington, D.C., office of Facebook to meet its reps in the nation’s capital.

Perhaps not surprisingly, the social networking site has a very small staff–just a trio of on-the-young-side dudes–battening down the hatches from a funky office in a funky section of D.C., Dupont Circle, far from the tonier and lobbyist-rich K Street corridor.

In contrast, both Microsoft (MSFT) and Google (GOOG) have a massive D.C. presence, trying to influence policy.

Still, as many in government know–such as Sarah Palin this week–Facebook has become a key tool in the basic bag of political tricks, used for organizing, canvassing, communicating and, every now and then, inspiring.

But there is also a raft of thorny legislative issues for Facebook, especially related to privacy, an arena where the company has repeatedly shot itself in the foot (Beacon! TOS!).

The company’s relatively new D.C. staff will presumably be a little smoother going forward.

They include:

Director of Public Policy Tim Sparapani, most recently with the American Civil Liberties Union, who joined in the spring.

Adam Conner, who opened Facebook’s D.C. office and who worked for some pols when he was still a college student, showing them how to use social media.

And, most recently, joining as manager of public policy communications, Andrew Noyes, a former reporter for the National Journal (and the man in 17D who pinged me on a Virgin America flight last week to meet him and the other Facebook policy wonks).

Here’s a video of the interview, in which we discuss all the big issues, from privacy to data retention to how Washington’s view of tech still has not evolved much:

[ See post to watch video ]

MicroHoo Answers Some Deal Questions for Critic: A Q&A!

Kara Swisher — Thu, 08 Oct 2009 20:20:11 +0000

Yesterday, BoomTown wrote about the status of the regulatory approval for the Microsoft-Yahoo search and online advertising pact.

While none of the key constituencies wanted to comment or make predictions about the outcome of the government scrutiny, most seem to agree that the MicroHoo partnership is more likely to be approved than not.

One of the few vocal critics of the deal, though, is Jeffrey Chester, the executive director of the Center for Digital Democracy, a public interest group.

CDD, along with several other consumer groups, recently sent a letter to the Justice Department’s antitrust head, Christine Varney, expressing concern about the control and collection of consumer data in the deal.

CDD also has been querying Microsoft (MSFT) and Yahoo (YHOO) directly about the data collection and privacy implications of the deal, which is something the government should be doing.

So, to further get a glimpse into MicroHoo’s arguments, here is a set of important questions Chester asked then that were answered in a memo by the pair:

What specific data collection, interactive ad technologies and targeting applications will be used for search under the 10 year deal?

Today, Yahoo! collects data about Yahoo! visitors to our search product and uses that information to deliver products and to customize advertising and content, among other purposes described in its Privacy Policy. Microsoft and Yahoo! have each adopted industry-leading privacy practices with respect to search. For instance, under Yahoo!’s global data retention policy, Yahoo! anonymizes user log data within 90 days with limited exceptions for fraud, security and legal obligations. For search specifically, Yahoo! will convey certain data to Microsoft to fulfill a user’s search request. This includes the query and the IP address. Microsoft will anonymize this data sent to it by Yahoo! in accordance with Yahoo!’s announced data retention policies. Microsoft is only permitted to use search data that it obtains under the deal to operate and improve its search services and for no other purpose.

Will Yahoo’s behavioral targeting technologies for search still be used?

Yahoo! does not currently employ behavioral targeting in search. [Ed. note: Not completely true; see press release from Yahoo here on new targeting capabilities.]

Will any of Yahoo’s targeting apparatus be incorporated in any way with Microsoft Advertising, including with Bing?

No. This deal is limited to search, and as noted above, Yahoo! does not employ behavioral targeting in search.

Will search ads be sold by either Yahoo or Microsoft that provide for multimedia results, such as video?

Video advertising is still a small and growing area and as such, it’s impossible to predict what video ads in any form, including what a potential video search ad, could look like several years from now.

How may this deal affect the Yahoo! Newspaper Consortium?

The partnership Yahoo! has with the newspapers is broad and includes everything from content distribution, advertising cross sales, and technology platform development, to the display of Y! sponsored search listings on the newspapers’ own Web sites. Yahoo! Does not see the Microsoft deal as having an immediate impact on its newspaper consortium dealings. However, by combining its platform with Microsoft’s, Yahoo! and Microsoft will be in a position to offer the Newspaper Consortium and other web publishers more competitive bids for search syndication deals than either company can offer separately.

What ad research and development will be shared or done in common?

It is premature to speculate about the exact research that will be done, but the increased scale that will result from this search deal is expected to significantly enhance the ability to conduct meaningful research in a timely manner.

What rationale was used to embrace the 3 month data retention time? Why isn’t a shorter retention time adopted?

Yahoo! did an extensive analysis and review of all our data systems globally in 2008. Yahoo! arrived at 90 days retention as the right timeframe for most of its log file data that allows it to deliver the industry-leading products and services its users expect from them, but that also minimizes the duration of time Yahoo! holds data in identifiable form. It’s important to note that some of Yahoo!’s log file systems retain identifiable data for less than 90 days but none will hold data longer except for a limited number of specific systems dedicated to fraud and abuse and to meet legal obligations.

How do you envision Yahoo remaining viable when it no longer has a meaningful independent search service, given the need to have a coordinated search/display environment for digital marketing?

Future growth in online marketing will come from shifting spend from offline advertising to the online world. Offline advertising spend is disproportionately held by the largest advertisers and they control the vast majority of ad spend. Yahoo! has the leading position in branded advertising and Yahoo! also serves the needs for the growing market of performance advertising. So this deal with Microsoft enables Yahoo! to deliver a fully integrated solution that meets marketers’ needs at scale. Through this deal, Yahoo! retains a revenue stream in search without incurring the costs of developing a search platform or engine. Yahoo! will get paid an 88% TAC rate while eliminating significant expenses, enabling Yahoo! to invest more heavily in other areas of focus: amazing audience properties, web products, enhanced display advertising capabilities, and fantastic mobile experiences.

Microsoft-Yahoo Deal Regulatory Update: "Eh"

Kara Swisher — Wed, 07 Oct 2009 14:31:36 +0000

Unlike the gripping back and forth of the fight over Yahoogle last year, the approval process for the search and online advertising partnership of Microsoft and Yahoo is chugging along slowly but surely as the Justice Department has deepened its investigation by reaching out to a broad range of publishers, advertisers, public interest groups and rivals for comment recently.

A month ago, the government agency lobbed in a “second request” for information about the deal the pair struck earlier this summer.

This kind of regulatory review is typical in deals of this magnitude.

But so far, there is no significant external challenge to the MicroHoo deal, even–according to many sources BoomTown has interviewed over the last week–from Google, the likeliest company to try to scuttle or, at the very least, slow down the deal.

“Is it worth fighting a big fight over?” asked one person close to the thinking of Google (GOOG). “Not really.”

Said another source, surveying the state of play: “It’s eh, kind of inevitable and not that interesting on a lot of levels.”

While none of the key constituencies wanted to comment or make predictions about the outcome of the regulatory scrutiny, most seem to agree that MicroHoo is more likely to be approved than not.

At the time the partnership was announced in July, execs at both Microsoft (MSFT) and Yahoo (YHOO) said a lot of investigation was likely from Justice, although they said they were also confident that it would be allowed go through by year’s end.

So far, several sources said, the key issue raised by the Justice Department has been whether the argument Microsoft and Yahoo are making–that they need scale to compete with Google–is valid or not.

Currently, Google has just under 70 percent of the search market in the U.S., while Microsoft and Yahoo together have about 28 percent.

Google has been arguing that huge scale is not necessary to be successful in the search ad market, although its execs have often said bigger is better when it comes to natural search and in spurring more clicks on ads.

Meanwhile, Microsoft and Yahoo have said they need all the firepower they can muster together to battle Google’s hegemony.

In a related concern, some regulators are worried–as they were when Google and Yahoo were trying to get approval for a similar deal last year–that any hookup of big players in the market will effectively take Yahoo out of the search business.

“With only three big players, going to two is not desirable to the government,” said one source. “Yahoo has to reassure everyone that it is focused on a sustainable business model beyond search.”

In a blog post yesterday, in fact, Yahoo said it was committed to search innovation.

In any case, most expect another month of investigation at least, although the lack of any loud voice in opposition could shorten that time frame.

And, added some sources, unlike with Yahoogle, there is not likely to be any kind of Congressional hearing on the deal.

Nonetheless, Microsoft, Yahoo and Google remain concerned that deals like this will lead to more focus on privacy issues, specifically around behavioral targeting.

That would be more a matter for legislators or the Federal Trade Commission and would probably come well after the deal is cleared and as part of a bigger topic.

Rep. Rick Boucher (D., Va.), who chairs the Subcommittee on Communications, Technology and the Internet, said he will consider consumer privacy legislation this fall.

Boucher led hearings on the subject this summer, and there might be more, especially as Web companies garner a lot of personal information from consumers with little oversight of what they do with those data.

If Boucher does call for hearings, he might want to replay this particularly boneheaded (but funny!) video from Yahoo’s U.K. ad staff, which classifies various Yahoo customer types–such as “disco-dancing heart surgeons from Nantwich”–as farm animals:

Please see this disclosure related to me and Google.

MSN Debuts Online Health Service

Kara Swisher — Thu, 01 Oct 2009 07:20:35 +0000

MSN, Microsoft’s online portal, released a beta version of a service to let users manage their health information on the Web.

Called My Health Info, the Microsoft (MSFT) offering, which includes a range of widgets and other Web tools, wades into an area that many are attempting to crack, including Google (GOOG).

The service, which will be located on MSN’s health site, will use Microsoft’s HealthVault platform and Silverlight technology, taking the company’s effort to create a platform for storage of health information into the mainstream.

Due to issues of privacy and security, consumers have been slow to warm to loading up their personal health information on the Web.

Microsoft said users can also “research medical concerns, read the latest health news, gain guidance from medical experts, learn about nutrition, and monitor conditions such as high blood pressure or diabetes.”

Google has a similar beta product called Google Health, and there are others. In fact, the former head of Google Health, Adam Bosworth, has a similar start-up called Keas.

All efforts are trying to get consumers to embrace and feel comfortable in putting their health information online and offer easier tools to do that.

Here’s a screen shot of My Health Info:

Here’s the Microsoft press release on the service:

MSN Introduces Online Tools to Help People Make Smarter Health and Lifestyle Decisions

From swine flu info to symptom checkers, MSN My Health Info includes a broad range of widgets and tools to attract health-minded consumers.

REDMOND, Wash.–Oct. 1, 2009–Today, MSN released the beta of My Health Info, a new online service that helps people manage their health information on the Web. My Health Info is a unique service that offers people a variety of tools and widgets to upload, organize and monitor health information stored in their personal Microsoft HealthVault accounts. The new service allows people to research medical concerns, read the latest health news, gain guidance from medical experts, learn about nutrition, and monitor conditions such as high blood pressure or diabetes.
In addition, MSN is launching a specialized swine flu information center today on the MSN Health & Fitness home page (http://health.msn.com), spotlighting the virus that is currently top of mind for people. MSN works with trusted consumer health information providers such as Harvard Medical School and the MayoClinic.com to keep people informed and armed with data to help them prevent contracting the virus, assess for risk factors, find out where to get vaccinations in their local neighborhood when they become available, and more.

My Health Info delivers features designed for busy parents, adults who are managing the health concerns of aging parents, and people managing chronic conditions and multiple medications. Because the data is stored in Microsoft HealthVault, people can access their information via the Web whenever they need it and share it across multiple connected health applications. My Health Info will allow consumers to do the following:

Customize their page with tools such as allergy, medicine and blood pressure trackers, a lab results bank, body mass index calculators, vaccination information and more

Use information from personal health devices such as heart-rate monitors and pedometers

Access profiles of multiple family members at one time, allowing caregivers to more easily manage not only their information, but their family’s as well

Stay informed by receiving the latest in health news from sources they trust

“People care deeply about credible, timely and comprehensive information about health topics. MSN My Health Info will provide an exceptional selection of resources, tools and information available from a variety of sources in one convenient location,” said Scott Moore, U.S. executive producer, MSN. “We are committed to delighting our customers with information, services and tools that keep them informed and simplify their lives.”

Consumers are increasingly looking for online solutions that help them take better control of their health decisions and their families’ information, and that connect them to the broader health ecosystem in which they interact. The My Health Info service enables MSN to offer a timely service to its users, which will be continually updated to help ensure that consumers are offered relevant tools. The service is connected with Microsoft HealthVault, which stores consumer health information in a controlled and privacy-enhanced environment, while enabling consumers to easily collect and transfer their data across the health system for a more holistic and better quality healthcare experience. The My Health Info site is powered by Microsoft Silverlight technology to deliver a rich, interactive Web experience.

“As consumers are increasingly being asked to manage more of their health and wellness, they are looking for solutions that help them navigate an overwhelming amount of information, enabling them to take control of their personal health data,” said David Cerino, general manager of consumer health in Microsoft Health Solutions Group. “Building on the power of HealthVault, My Health Info demonstrates how we are continuing to provide consumers with the trusted and relevant tools they need to make more informed decisions in support of their health and the health of their families.”

Survey: Americans Don't Like Being Hunted Online by Marketers

Kara Swisher — Wed, 30 Sep 2009 12:11:59 +0000

A new survey that should surprise only the people behind the Beacon debacle shows that a majority of Americans of all ages don’t like being tracked online by advertisers.

In related stating-the-obvious news, Americans also find Jon and Kate Gosselin super-annoying.

Actually, the independent poll, titled “Americans Reject Tailored Advertising,” by a passel of academics at the University of Pennsylvania and the University of California at Berkeley–which was first handed over to the New York Times and will be released today–comes at a very good time given all the focus on online privacy of late among lawmakers and regulators.

While advertisers have been trying to avoid a lot of stringent laws in this arena, it seems clear from the survey that most consumers–66 percent–don’t like being followed around and hate it more the more they know about said stalking by marketers.

Noted the report:

“It is hard to escape the conclusion that our survey is tapping into a deep concern by Americans that marketers’ tailoring of ads for them and various forms of tracking that informs those personalizations are wrong….Whatever the reasons, our findings suggest that if Americans could vote on behavioral targeting today, they would shut it down.”

Not that Americans actually know a lot about how online behavorial targeting works. Many surveyed had little knowledge of the tactics, but most did want a law that would give them the right to know what, say, the social networking minions of Facebook CEO and founder Mark Zuckerberg know about them.

In other words, consumers want transparency and control of their data, which–at the pace things are going–continues to spin out of their grasp.

Cloudy With a Chance of Computing: BoomTown's NPR Debate With Harvard Law Prof Zittrain

Kara Swisher — Mon, 10 Aug 2009 22:00:23 +0000

This morning, BoomTown was interviewed on the very terrific National Public Radio talk show, “On Point,” along with Harvard law professor Jonathan Zittrain.

The program, moderated by Tom Ashbrook on Boston’s WBUR station, was titled “From Desktop to the Digital Cloud” and dealt with the increasing move of data of all kinds online and into the so-called “cloud.”

In other words, eventually, a completely virtual life for music, photos, records and more, and the end of packaged software.

Zittrain, who was co-founder of the Berkman Center for Internet and Society, also wrote the scary-sounding book, “The Future of the Internet–and How to Stop It”–a kind of ladies-lock-up-your-daughters title it’s hard not to love for its chutzpah.

He also penned an op-ed piece for the New York Times recently, with another corker of a title: “Lost in the Cloud.”

Some of the “real dangers” of the move to cloud computing that Zittrain cited in the piece: Losing control of data, losing data itself, privacy issues, federal government overreaching, even more nefarious governments abroad and a damper on innovation.

Zittrain is a smart cookie, to be sure, although I did not really agree with him at all on the show about pretty much any of his concerns.

For some non-cloud-friendly reason, WBUR does not allow me to embed the show here; you can listen to it in its entirety by clicking here.

Also, here is a posted response by Zittrain after the conversation, in which I failed to assuage him. He remains “still worried.”

Yahoo-Microsoft Regulatory Filings Start This Week: Let the Legal Game-Playing Begin!

Kara Swisher — Tue, 04 Aug 2009 10:01:32 +0000

After all the investor hubbub over the oh-no-they-didn’t deal between Yahoo and Microsoft starts to die down a bit, the pair are now embarking on the path that is the only way toward proving the efficacy of them joining together.

That would be getting a variety of state, federal and international regulators to say yes to the wide-ranging online advertising and search arrangement they announced last week so they can start making it work.

According to sources at both companies, a variety of filings will be made this week, including one to the Securities and Exchange Commission that should provide more details of the partnership.

When it was unveiled last Wednesday, the companies said Microsoft (MSFT) will run search technology for the two, while Yahoo (YHOO) will sell the premium search advertising.

That SEC filing could answer a number of questions some still have about the deal, such as whether there is a large break-up fee that Microsoft would pay Yahoo in case the deal is scuttled.

That’s just the outcome that Microsoft and Yahoo are trying to avoid.

“We think of it as an outreach effort to explain how we are creating a strong No. 2 to Google,” said one source close to the situation. “The main goal will be to show that a better competitor in the marketplace is a good thing.”

While the companies are prepping for opposition from Google (GOOG), sources close to the thinking at the dominant search company said it is more likely to be muted and indirect.

That’s especially true since a MicroHoo makes Google–currently under a lot more government scrutiny than ever before–look like less of a bully.

Thus, Google’s tactics would entail less direct statements and more pointing out the discrepancies between what Microsoft said when Google tried to get approval for a search deal with Yahoo last year and what it argues now.

“They will probably not be that obvious, but they will be there still,” said Microsoft CEO Steve Ballmer to me, in an off-hand remark at the software giant’s Financial Analyst Meeting last week.

It’s a game of legal chicken that Ballmer knows well.

Already, for example, Microsoft and Yahoo execs have been aggressively reaching out to major publishers and advertisers to get their staunch support.

That included calls immediately after the deal was announced last Wednesday to such execs as Martin Sorrell of the WPP Group (WPPGY) and Jeff Zucker, CEO of NBC Universal, a unit of GE (GE).

In Washington, D.C., both companies have legions of lawyers to try to make sure the Justice Department, which will review the case due to its antitrust implications, has all the information it might need.

And, more to the point, they want to avoid the debacle that took place when Yahoo and Google tried to get approval for their failed deal last year.

That deal was ended by Google after it became clear that Justice was going to fight it by arguing that top search companies hooking up hurt competition and stifled innovation.

In addition, there might be Congressional scrutiny, with possible hearings, similar to those held when the Yahoogle deal was pending, such as in the Senate Judiciary Antitrust Subcommittee.

And, of course, there are actually independent groups concerned and they have also been in contact with regulators.

“There are questions that must be answered regarding the collection and sharing of consumer data by the two companies,” said Jeff Chester, executive director of the Center for Digital Democracy, a D.C.-based group that works to promote consumer privacy and protection online, in a statement last week. “While the rationale for the deal is to provide some much needed competition to Google (and income for Yahoo), the further consolidation of the global digital advertising system should be a concern to Internet users, privacy advocates, online marketers, and competition regulators.”

Sources said Microsoft and Yahoo also plan to petition regulators in the European Union this week, which is likely to be most concerned about privacy issues involved in their union.

They will also be doing the same in other key countries worldwide, such as Korea, Taiwan and Brazil.

And, finally, given how involved state attorneys general became in beaching the Yahoo deal to partner with Google, they also will be starting outreach to key states, such as California, where Silicon Valley-based Yahoo is headquartered.

“Once again, it will be the Lawyer Employment Act of 2009,” joked one person close to the deal. “At least, that shows there is some economic benefit to this deal already.”

While we all wait in breathless regulatory anticipation, here are interviews I did at last year’s Senate hearings on Yahoogle, with lawyers from Google (David Drummond), Microsoft (Brad Smith) and Yahoo (Mike Callahan).

Incredibly, they are the very same lawyers who will be pretzeling themselves in entirely different shapes than they pretzeled themselves a year ago.

I would expect nothing less!

Here’s the video:

[ See post to watch video ]

One Last Yahoo Reorg Missive: Bartz Tells Employees What She Already Said. Again.

Kara Swisher — Fri, 27 Feb 2009 00:00:15 +0000

Goodness gracious, make it stop!

You must know by now how much BoomTown loves internal Yahoo (YHOO) memos. But this is getting ridiculous.

It’s been like a flash flood after a long drought at Sunnyvale HQ today, as Yahoo CEO Carol Bartz turns on the fire hose of a whole lot of communicating.

A lot. A real lot.

“I know you guys have reorg fatigue,” wrote Bartz, in the latest email to employees about the management reorganization finally announced this morning.

Also memo fatigue at All Things Digital HQ, if you can believe it.

Okay, I give, Carol! Well, for now, until another juicy internal memo you aren’t handing out freely lands in my inbox, for example, such as one about a search deal with Microsoft (MSFT). I’d like one of those to go, please!

But, in a gesture of a leak-free peace (can the drop-kick bounty be suspended for just today?), I am posting this last memo about the management reorganization from Carol “Chatterbox” Bartz.

(Although, I wish she would stop insulting the press, as she does below again. We are just doing our job–and very accurately, as it turned out–yet the jibes continue. Which is odd, frankly, given that Bartz has had mostly glowing coverage in the media her entire career.)

But Bartz did seem to leave a little mystery in the email still, as if even more rearranging were to come.

Writes Bartz (my bolding):

“As soon as decisions were made, I wanted you to know about them–even if that means we don’t have all the details nailed down yet”.

Wait, are the deets all nailed by Bartz’s productive hammer or aren’t they?

At least, thankfully, the note is capitalized properly, unlike the quaint no-caps stylings of former CEO Jerry Yang.

In any case, if you just can’t get enough, here is Bartz’s reorg blog from this morning and her new management structure memo too.

And here is her entire email on the reorg to employees:

From: Carol Bartz
Reply-To: Carol Bartz
Date: Thu, 26 Feb 2009 09:02:49 -0800
To: “all-worldwide@yahoo-inc.com”
Subject: Our New Organization

Yahoos,

As I’ve gotten to know Yahoo! over the past several weeks, I’ve developed a point of view on how our organization should be structured to set us up for success.

Our goal is simple: to consistently deliver awesome consumer and advertiser experiences, everywhere in the world we do business. Delivering great customer experiences is everyone’s job at Yahoo!–and each part of our organization will have a clear role in making that happen every day.

The timing of this announcement is important. As soon as decisions were made, I wanted you to know about them–even if that means we don’t have all the details nailed down yet. Yes, there’s been a lot of speculation in the media over the past few days…that’s been a little frustrating, but I’m not willing to speak publicly about decisions before they’re final. Today, they are–so I’ll lay out our new organizational structure for you now.

I know you guys have reorg fatigue. Hang in there–our intention is to leave this structure in place for two to four years. We’ll continue to make adjustments as needed, but we expect this core structure to stay put.

The structure outlined below will enable us to make big improvements in our product quality and operational efficiency. Part of that is simplicity–I’m frankly amazed at how complicated some things are here! We’ll have much clearer decision making and accountability. Product and regional teams will share responsibility for revenue targets and expense management, but we’ll have one P&L, for which I’m accountable.

We will also be in a better position to really listen to and understand our customers–both consumers and advertisers. I think we’ve gotten into the habit of focusing internally too much and we sometimes forget who we’re here to serve. You’ll notice that our management structure puts a renewed focus on the customer, with stronger feedback loops across the company…and they all come through me.

Also, as you know, no organizational structure is a substitute for collaboration, communication and trust. We’ll all need to evolve our behavior a bit–as teams and as individuals – to make this structure work the way it’s designed.

So here’s the overview, with the roles that will report directly to me. As you’ll see, some of our leaders are still to be determined. I know you’ll
want more detail than what’s below–you can learn more on Backyard: http://backyard.yahoo.com/ourorg .

Products: We’ve combined Tech and Product groups under one roof, led by Ari Balogh as EVP Products & CTO. Ari’s charter is to deliver global products that enable extraordinary consumer and advertiser experiences. Ari’s direct reports now include one leader for each product group–we’ve taken care of the “two in a box” problem.

One important note: The Connected Life team has been integrated into various parts of the new organization. Our mobile strategy remains a key part of Yahoo!’s focus going forward and all of our product groups will own mobile innovations. After leading Connected Life for four years, Marco Boerries has resigned from the company to spend more time with his family in Europe. We thank Marco for his important contributions at Yahoo!.

Regions: There are now two: North America and International. As I’ve said before, international growth is critical for Yahoo!, which has become too reliant on its U.S. business over the years.

The regions deliver Yahoo!’s products, programming and services to consumers, partners and advertisers in local markets. They will partner closely with the newly formed Regional Solutions & Products group in Ari’s organization to help drive a significant shift in how Yahoo! develops products for different geographies. The goal is to have global platforms on which regional product offerings are based.

The North American region–comprised of the U.S. and Canada–is led by Hilary Schneider. The leader of our International region, to be hired soon, will be responsible for a cohesive Yahoo! global strategy and seizing our international growth opportunities. Until we determine who’ll lead the International region, Rose Tsou (Asia), Rich Riley (Europe) and Keith Nilsson (Emerging Markets) will continue to report to me.

Marketing: Elisa Steele will be joining Yahoo! as our Chief Marketing Officer (CMO), effective March 23. Elisa joins us from NetApp where she was SVP, Corporate Marketing. Previous to NetApp, she held executive positions in marketing at Sun Microsystems. Elisa will oversee our global marketing strategy and provide direction for our marketing function. She’ll bring together the various Yahoo! marketing teams that have been spread across the company. Reporting into Elisa will be Brand Marketing, Audience Marketing, Corporate Communications, Insights, Policy & Privacy, Community Affairs and related central teams. I’m delighted to have Elisa joining the team.

Customer Advocacy: As I said, we can do much better in hearing the voice of the customer across Yahoo!, and incorporating what we hear into all of our work day-to-day. We have opened a search for a leader, who will oversee Customer Care and Ad Operations globally with the goal of improving how we support Yahoo!’s users and advertisers. In the interim, these teams will continue to report to Hilary.

Service Engineering & Operations: This new team is responsible for delivering common technology services at scale, including application management and infrastructure. No matter how cool our products are, the customer’s experience won’t be great unless our applications consistently deliver. Note that we’re bringing Service Engineering together as one group because these engineers bring expertise that is best applied horizontally. Leading this organization is David Dibble, who joined Yahoo! in December. David’s team also will be accountable for delivering more effective corporate IT systems.

Corporate Functions: Blake Jorgensen will be leaving Yahoo! and I am searching for a new CFO. Blake will remain through a transition with his successor, and I want to thank Blake for all of his great contributions to Yahoo! over the past two years. Mike Callahan will continue to lead our Legal team, and David Windley leads our Human Resources function. Joel Jones joins the team as my Chief of Staff.

So that’s the high-level view. These changes are effective immediately, but we’ve got more work to do in filling out the structure of each group. In the short term, this transition will be challenging for many of our people. My executive staff will be working with their organizations as quickly as possible to create further clarity. For example, we’ll need to recast budgets and adjust work areas so we have the right people working side-by-side.

I want to thank all of you who’ve shared your ideas and views with me since I arrived. Several leaders across Yahoo! came together to design this new structure–I’ve been very impressed with their dedication to the right outcomes, particularly how they’ve embraced the need to eliminate the silos that have been a drag on this organization for so long.

I think this organizational structure has the potential to solve many of the issues you’ve helped me better understand. Of course, new issues will emerge. But I know we’ll be aligned and nimble in tackling them together.

This is a tremendous, proud company with a powerful brand, great products and a bright future. Now’s the time to get more focused than ever on delighting our users and advertisers. Let’s show them how great Yahoo! can be.

Carol

BoomTown Decodes the Zuckerberg Terms of Service My-Bad Memo (Now With 10 Percent More "So Very Sorrys!")

Kara Swisher — Wed, 18 Feb 2009 10:21:00 +0000

Under cover of darkness last night, Facebook founder and CEO Mark Zuckerberg announced on the social-networking site’s blog that it would “return to our previous terms of use while we resolve the issues that people have raised.”

Oh, this is just too good to resist. Therefore, BoomTown shall not tarry in our ongoing job of busting the chops of the young Facebook leader, whose minions have actually–and I am not joking here–given him the nickname: The Wizard.

Well, the Wizard obviously had to pull back the curtain last night and show some serious mea culpa to the people, before they got out the pitchforks.

That’s due to the controversy Facebook has been embroiled in this week about changes it recently made to its Terms of Service that gave the company unusually sweeping rights over customers’ content and privacy.

While Zuckerberg had said in his first post about the issue that Facebook was not in the content-stealing business, the strong language in the ToS sent the usual suspects into a major meltdown over the possibility that the young geek had gone into full-scale evil mogul mode.

As if!

In fact, Zuckerberg has been ensconced in his Silicon Valley lair for years now, counting down until he knows precisely everything about everyone’s drunken college days!

Until D-Day then, here is my translation of his latest backtracking post:

What the Wizard wrote: Update on Terms

by Mark Zuckerberg

Today at 10:17 pm

Translation: OK, I have reached my limit of being yelled at by Sheryl and Elliot, have had my usual breakfast of Red Bull and Frosted Flakes–they’re grrreat!–and am ready to eat some major digital crow this morning.

I mean, night, which is my morning, because I actually slept through all this noise today about this whole Terms of Service “controversy.”

What the Wizard wrote: A couple of weeks ago, we revised our terms of use hoping to clarify some parts for our users. Over the past couple of days, we received a lot of questions and comments about the changes and what they mean for people and their information. Based on this feedback, we have decided to return to our previous terms of use while we resolve the issues that people have raised.

Translation: Did you know crow is delicious if you eat it with a little Bosco on top?

More to the point, I would just like to assure you that we have taken our lawyers–who idiotically rewrote our ToS to give us ownership rights to the Bible, “American Idol” and everything Bill O’Reilly utters–and sent them over to our friends at MySpace, because their owner, News Corp. (NWS), already owns two of those three [and also this site!].

What the Wizard wrote: Many of us at Facebook spent most of today discussing how best to move forward. One approach would have been to quickly amend the new terms with new language to clarify our positions further. Another approach was simply to revert to our old terms while we begin working on our next version. As we thought through this, we reached out to respected organizations to get their input.

Translation: As in: More yelling by Sheryl and Elliott and more Fedexing of lawyers to MySpace HQ in Beverly Hills.

But after we calmed down, we all decided the best course of action was to shoot ourselves in the right foot to stop the bleeding from when we shot our left foot before.

We are, of course, completely out of feet now, so if these hijinks continue, sooner or later, someone is going to lose an eye. By someone, I mean, um, me.

What the Wizard wrote: Going forward, we’ve decided to take a new approach towards developing our terms. We concluded that returning to our previous terms was the right thing for now. As I said yesterday, we think that a lot of the language in our terms is overly formal and protective so we don’t plan to leave it there for long.

Translation: Facebook, of course, never had any intention of stealing content and copyright! Perish the thought! After all, that’s the job of Google (GOOG)!

By contrast, ours is to collect incredibly embarrassing photos of everyone in the United States until one of them runs for president, and then our nefarious scheme to control the world begins.

We were planning on blackmailing the world for one billllliiiion dollars then, but Microsoft kind of forked over 15 times that without any pressure.

Still, we would like to own Palo Alto, Calif., and get free parking 24/7, so there will be demands!

Until then, enjoy the sheep-throwing. Mwaahahahahahahaha! (Quick visual: I am petting my white cat right now with Ernst Stavro Blofeld-like evil glee, and am, of course, cackling.)

What the Wizard wrote: More than 175 million people use Facebook. If it were a country, it would be the sixth most populated country in the world. Our terms aren’t just a document that protect our rights; it’s the governing document for how the service is used by everyone across the world. Given its importance, we need to make sure the terms reflect the principles and values of the people using the service.

Translation: Not to be completely and utterly arrogant or anything, but we just passed Pakistan, and those Brazilians better get ready to samba.

By the way, once we get to No. 1–look out, China!–we plan on decreeing that everyone in the world speak Pig Latin and that forthwith it will be flip-flop Fridays.

Also: Esyay, Iway amway anway alienway omfray anotherway anetplay.

What the Wizard wrote: Our next version will be a substantial revision from where we are now. It will reflect the principles I described yesterday around how people share and control their information, and it will be written clearly in language everyone can understand. Since this will be the governing document that we’ll all live by, Facebook users will have a lot of input in crafting these terms.

Translation: Ybay ethay ayway, “Otay Ervesay Anmay”? It’sway away ookbookcay.

In other words, I am sure you will make delicious contributions, after which Facebook will “invite” you to our world-wide HQ to share in a lovely meal.

Especially those Winklevii. I look forward to the twins coming by soon!

What the Wizard wrote: You have my commitment that we’ll do all of these things, but in order to do them right it will take a little bit of time. We expect to complete this in the next few weeks. In the meantime, we’ve changed the terms back to what existed before the February 4th change, which was what most people asked us for and was the recommendation of the outside experts we consulted.

Translation: To my credit, I did give in much quicker than with the Beacon ad snafu. And you thought I learned nothing during that debacle!

And, by outside experts, I mean Microsoft (MSFT) CEO Steve Ballmer, who yells much, much louder than Sheryl or Elliot combined.

What the Wizard wrote: If you’d like to get involved in crafting our new terms, you can start posting your questions, comments and requests in the group we’ve created–Facebook Bill of Rights and Responsibilities. I’m looking forward to reading your input.

Translation: Here’s my first pass, based on the U.S. Bill of Rights, Amendment I:

Facebook shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition Faebook for a redress of grievances.*

*Exceptway, ithway ymay ompletecay iscretionday, enwhay Iway
ecideday otherwiseway.

Facebook's Mark Zuckerberg Cries Uncle on ToS Snafu: The Entire Backtracking Blog Post

Kara Swisher — Wed, 18 Feb 2009 07:07:01 +0000

Late tonight, Facebook founder and CEO Mark Zuckerberg posted a blog entry, saying the popular social-networking site would “return to our previous terms of use while we resolve the issues that people have raised.”

Facebook has been embroiled in a controversy this week about its Terms of Service–essentially a Web site’s rules that users must abide by while using its online service–after recent changes gave it more sweeping rights over customers’ content and privacy.

While BoomTown in no way thinks Facebook had any intention of asserting copyright ownership over intellectual property posted by users, the language was strong enough to make such a thing possible and went much further than other sites on the issue.

My guess: It was more likely a case of lawyers gone wild.

Facebook’s Zuckerberg said in a post yesterday that the service had made the changes in the first place in order to archive posts and other content users had shared with each other, even after such material was deleted.

“When a person shares something like a message with a friend, two copies of that information are created–one in the person’s sent messages box and the other in their friend’s inbox. Even if the person deactivates their account, their friend still has a copy of that message,” he wrote in his first post.

To be fair, Zuckerberg also had noted: “Our philosophy is that people own their information and control who they share it with.”

But the fact that Facebook had still given itself such wide-ranging rights over content, whatever the reason, had caused a nuclear explosion online among users, privacy advocates, content owners and the media.

Thus, in full backtracking mode tonight, Zuckerberg returned Facebook’s ToS to its previous version, pending new wording. He also said a new “Facebook Bill of Rights and Responsibilities” (you can join here) was on the way and asked for user input.

Viva La Revolución! I vote for no more SuperPoking!

Here is the whole blog and here is a link to it on Facecook too:

Update on Terms

by Mark Zuckerberg

Today at 10:17 pm

A couple of weeks ago, we revised our terms of use hoping to clarify some parts for our users. Over the past couple of days, we received a lot of questions and comments about the changes and what they mean for people and their information. Based on this feedback, we have decided to return to our previous terms of use while we resolve the issues that people have raised.

Many of us at Facebook spent most of today discussing how best to move forward. One approach would have been to quickly amend the new terms with new language to clarify our positions further. Another approach was simply to revert to our old terms while we begin working on our next version. As we thought through this, we reached out to respected organizations to get their input.

Going forward, we’ve decided to take a new approach towards developing our terms. We concluded that returning to our previous terms was the right thing for now. As I said yesterday, we think that a lot of the language in our terms is overly formal and protective so we don’t plan to leave it there for long.

More than 175 million people use Facebook. If it were a country, it would be the sixth most populated country in the world. Our terms aren’t just a document that protect our rights; it’s the governing document for how the service is used by everyone across the world. Given its importance, we need to make sure the terms reflect the principles and values of the people using the service.

Our next version will be a substantial revision from where we are now. It will reflect the principles I described yesterday around how people share and control their information, and it will be written clearly in language everyone can understand. Since this will be the governing document that we’ll all live by, Facebook users will have a lot of input in crafting these terms.

You have my commitment that we’ll do all of these things, but in order to do them right it will take a little bit of time. We expect to complete this in the next few weeks. In the meantime, we’ve changed the terms back to what existed before the February 4th change, which was what most people asked us for and was the recommendation of the outside experts we consulted.

If you’d like to get involved in crafting our new terms, you can start posting your questions, comments and requests in the group we’ve created—Facebook Bill of Rights and Responsibilities (http://www.facebook.com/group.php?gid=69048030774). I’m looking forward to reading your input.

Cat Fight, Internet-Style: Perez Hilton Slaps the Face(book) of Not-BFF Mark Zuckerberg

Kara Swisher — Tue, 17 Feb 2009 11:36:26 +0000

In a BoomTown post last night noting that users should just get used to not having much control of their privacy and posted content online, in the wake of the controversy over Facebook’s terms of service changes, how could one leave out this gem of a digital diatribe on the issue by gossipmonger supreme, Perez Hilton?

In an item yesterday, Hilton–who has gotten into a lot of copyright infringement legal trouble himself–asked his fans to boycott the fast-growing social-networking site and claimed that Facebook “can license your personal pictures out to companies, make a shizzle of money and don’t have to give you a dime.”

Facebook could certainly use a shizzle or two, but that seems about as likely as people like Hilton laying off of Jessica Simpson for her alleged weight gain. (Speaking of which–Hey, Perez, let’s say we just blame the bad jeans and move on, shall we?)

Nonetheless, it is still kind of fun to watch as different worlds collide so perfectly.

Of course, Hilton’s Facebook app was still up last nigh, although it apparently only has 361 monthly active users, compared to SuperPoke’s sheep-tossing 6.3 million.

Not to be catty or anything!

In any case, here’s a link to the Hilton post and an image of it below (one can only dream that Perez will come after me with that digital Sharpie for lifting it!):

"You Have Zero Privacy Anyway. Get Over It"–That Goes Double on Social Networks

Kara Swisher — Tue, 17 Feb 2009 01:36:51 +0000

When Sun Microsystems (JAVA) Gadfly-in-Chief Scott McNealy made his infamous statement about online privacy in 1999, there was a horrified hubbub at the time that he had the audacity to say such a thing.

You know, that he actually uttered such a terrible thing as the truth.

What a shock then that everyone is now in yet another tizzy about Facebook changes to its Terms of Service, which pretty much state the obvious again by noting that Facebook archives info you posted, even if you quit the service.

As in, you probably can’t delete it.

No, you can’t–because you shared it, whether it be a photo, an email, a Wall post, whatever, already.

Because the fact of the matter is–since the moment the first caveman sent the first email to another Neanderthal–there has never been true online privacy for anyone who has chosen to participate in this highly interactive medium.

Here’s the key definition of interactive: “mutually or reciprocally active.”

That means once you send something to others, it is out there in cyberspace forever, never ever to return.

And that goes double on social-networking sites, where–let’s be honest–people egregiously overshare and then get all righteous when it is explained to them that sharing means, um, sharing.

As in: You cannot take it back, if you have shared with 476 of your closest “friends,” your bikini shots from Cabo.

Now, BoomTown has learned to live with some very unfortunate haircut choices preserved forever online and does not often agree with Facebook founder Mark Zuckerberg (I and everyone else slapped him silly on the Beacon debacle until he gave in, for example).

But he is technically right on this, even if Facebook could have done a much better job communicating the changes it made to its ToS, especially since ToS controversies are the Bermuda Triangle of the online arena.

This lack of clarity has always a major Facebook weakness, but it was the same for AOL–now owned by Time Warner (TWX)–back in the day when it was raising privacy red flags all the time.

But that does not make Facebook wrong, as Zuckerberg finally said clearly in a post on Facebook:

People want full ownership and control of their information so they can turn off access to it at any time. At the same time, people also want to be able to bring the information others have shared with them—like email addresses, phone numbers, photos and so on—to other services and grant those services access to those people’s information. These two positions are at odds with each other. There is no system today that enables me to share my email address with you and then simultaneously lets me control who you share it with and also lets you control what services you share it with.”

Zuckerberg then notes that users are just going to have to trust services like Facebook with their data, which is up to the individual to decide before posting whatever online.

And, if regrets come later? Well, try this quote from the great playwright Arthur Miller: “Maybe all one can do is hope to end up with the right regrets.”

Obama YouTubes and Techies Swoon (BoomTown Will Only Do So When There Is a National Broadband Policy)

Kara Swisher — Sun, 16 Nov 2008 09:22:34 +0000

Is it just me or does the fact that President-Elect Barack Obama is broadcasting his weekly address on YouTube not seem like it should be the very biggest deal in the world?

Still, when an article in the Washington Post reported late last week that he would put his weekly Democratic address online in video–on YouTube and his own transition site, Change.gov–as well as the regular radio, the squeals from tech were louder than at a mall appearance by the Zac Efron of “High School Musical.”

While it is a first for the Commander-in-Chief, I am more depressed that it is a first–after all, skateboarding cats made it to YouTube eons ago–than utterly thrilled that he is doing it.

But, when it come to the glacial movement related to politicians and tech issues, disappointment seems to be a better stance than hope.

I could begin with the fact that the U.S. has poor broadband and wireless coverage compared with most comparable nations (Softbank’s Masa Son once told me in an interview that this country was the “third world of broadband”).

Ironically, the price of high-speed access ranks at the top, by really gross margins.

Or that the federal government remains unfocused on a number of important digital issues, from immigration to privacy to net neutrality.

Perhaps because of his more obvious use of Internet tools, from communicating to supporters to raising money to targeting voters, Obama has felt like the first true Internet candidate, well beyond the ultimately unsuccessful inroads made by Howard Dean in 2004.

And now with even more YouTube videos, the Twitters, a much more interactive Web site at Change.gov and, best of all, the possible appointment of a CTO for America, it has been a general lovefest that the Obama presidency has engendered from the Internet community, simply for the focus the sector is now getting.

And more interactive communications are promised, such as regular video interviews with senior members of the Obama administration.

“This is just one of many ways that he will communicate directly with the American people and make the White House and the political process more transparent,” spokeswoman Jen Psaki said to the Washington Post.

It’s not that BoomTown does not think this is a great thing, but to me, this kind of transparent communication should be as normal as it has become throughout the rest of society as a matter of course.

Also, it would be nice if the Obama videos were also distributed on many other video services besides YouTube, which is the largest, but owned by Google (GOOG), whose CEO Eric Schmidt is a prominent supporter of the new administration.

Still, the four-minute video that Obama released yesterday is a good first step, along with a previous one from transition Co-Chairman Valerie Jarrett, who recorded a two-minute video earlier in the week.

Both are below:

President-Elect Barack Obama

Transition Co-Chairman Valerie Jarrett