Yahoo's New/Old Mobile Strategy: Long Live The Deck

While Apple readies its open iPhone platform and Google prepares its Android mobile operating system, how will Yahoo! keep up? By doing the same thing it’s always done: organising a bunch of stuff into a Yahoo!-branded portal. In other words, the company is hoping that its rivals fail at making mobile-Web browsing easier, instead encouraging consumers to start their surfing at a Yahoo!-driven homepage, or “deck.”

At CES, Yahoo! chief Jerry Yang will unveil the latest version of Yahoo! Go, his company’s mobile app, with launch partners including News Corp.’s MySpace, eBay, and Viacom’s MTV Networks. Yahoo! will encourage companies to develop widgets for their mobile app the same way they might for Facebook or an iPhone. And Yahoo! will offer its mobile ad network as a way for developers to make money.

Will it work? Yahoo! is basically betting that consumers will find it easier to navigate their way to mobile Web sites through Yahoo!’s portal than on by doing it on their own — it’s the AOL strategy, circa 1995. For the time being, that could be true — most mobile phones have lousy user interfaces and Web browsers, and smartphones with better browsers and full keyboards make up a small per cent of the overall market.

But don’t bet on this strategy working long-term. The smartphone market is growing faster than the overall mobile phone market, and even “dumb-phone” makers like Motorola are realising that they need to quickly improve their browsers and software menus. QWERTY phones are coming down in price — see Palm’s $99 Centro on Sprint — and as iPhones, GPhones, and other smartphones take more share, Yahoo!’s portal will be far less relevant.

But Yahoo!’s biggest hurdle is distribution. In the U.S., carriers don’t like sharing their screen real estate, and have pushed Yahoo! away. “Although Yahoo! Go runs on about 250 mobile devices, and comes preloaded on some phones made by Motorola, LG, Samsung and Nokia, carriers in the United States strip the software from the phones,” The New York Times reports. “Currently, no American carrier offers phones with the Yahoo! software installed, forcing American consumers who want to use Yahoo! Go to download it themselves.” By the time that happens, mobile browsing may be good enough that no one needs Yahoo! Go in the first place.

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