Podcst
Episode 33: Overture (with the Internet History Podcast!) by Ben Gilbert and David Rosenthal

Episode 33: Overture (with the Internet History Podcast!)

from Acquired

by Ben Gilbert and David Rosenthal

Published: Mon Mar 13 2017

Show Notes

Episode 33: Overture (with the Internet History Podcast!) Ben & David dive deep into the early days of internet search, with the help of the best in the internet history business: Brian McCullough from the Internet History Podcast! We are huge fans of IHP at Acquired, so this was a real treat to collaborate with Brian and the great work he does over there. In this episode we cover the story of how a small incubator in Southern California spawned perhaps the greatest tech business model of all-time, Yahoo!’s fumbling of that golden opportunity, and Google’s recovery of that fumble to cross into the end zone of tech history behind the biggest moat ever constructed on the internet.

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Topics covered include:
  • Overture’s origins as part of the Idealab incubator run by famed early internet entrepreneur Bill Gross
  • Invention of the paid search business model… initially by returning ADS ONLY in response to search queries
  • The eventual marrying of Overture’s paid search (ads) with organic search results via syndication on other properties like Yahoo!
  • Revenue from Overture’s ad partnership saving Yahoo!’s business after the internet bubble burst
  • Yahoo!’s eventual acquisition of Overture for $1.4B in 2003
  • But… the really interesting story here: Overture’s 'inspiration' of Google’s business model and the creation of "the greatest advertising machine in the history of the world"
  • The original (pre-Overture) Google business model: selling a box!
  • Google’s differentiation vs Overture: focusing on the long tail, ad quality scores, and an advertiser-friendly auctionstructure
  • Google’s first major search syndication victory over Overture: AOL
  • Yahoo!’sfailedattempt to buy Google for $3B in 2002,leading it to settle for acquiring Overture instead the following year
  • “Project Panama” at Yahoo!, and itsimpact on the tech and internet history
  • Overture's (and later Yahoo!’s) lawsuitagainst Google for stealing the paid search business model— "the O.G. version of Snapchat and Instagram”
  • Paul Graham’s take on "What Happened to Yahoo?”
  • Perhaps the most important technology to come out of this whole episode: Hadoop
  • Thepower of incentive alignment in marketplaces— and creating the widest and deepest moats on the internet

The Carve Out: