Proving that portals are to 1998 as push was to 1996 – the Nasdaq buzzword of the hour – Yahoo! Inc today announced deals with AT&T, Inktomi and AltaVista intended to cement the net directory’s position as the most popular site on the web. Portal economics seem confusing, but the rules are simple. First, partner with everything that moves and partner with your enemies’ partners. For example, while the AT&T agreement will see the carrier marketing its products and services through Yahoo!, the deal does not affect Yahoo!’s partnership with AT&T rival MCI. MCI continues as back-end of Yahoo!’s online service, just as AT&T back-ends Yahoo!’s rivals Lycos Online, Excite Online and Infoseek Online (CI Nos 3,403, 3,405 and 3,407). Though limited in scope, the AT&T deal is worth millions to Yahoo!, says COO Jeff Mallett. The exception that proves the rule is that you don’t partner with your enemies. Accordingly, after two years of faithful service, Yahoo! is dumping AltaVista as its search engine default, just as it dumped OpenText in 1996. (OpenText went on, of course, to become Excite.) AltaVista is busy launching travel, finance and health ‘zones’ and has portal plans of its own. Yahoo! says it wants to avoid confusing customers, so in AltaVista’s place, it will use Inktomi, the OEM of search vendors. Inktomi wins business by refusing to compete with its clients and having no web site as such. Of course Inktomi signed a precisely similar agreement with Yahoo! clone Snap! last week (CI No 3,405), but that’s neither here nor there. However, the final rule of portal-nomics is never to burn your bridges. To prove there are no hard feelings, AltaVista and Yahoo! announced one more deal, which will see AltaVista offered as an option to Yahoo! customers who want to stick with the brand they know and love. That’s the portal world for you. It’s a little like old-fashioned business, but a lot like Melrose Place.
