Yahoo Devours Del.icio.us
SUNNYVALE, California — In its latest acquisition of a social networking service, internet powerhouse Yahoo on Friday chomped down on del.icio.us, a startup that enables people to more easily compile and share their favorite content on the web.
Context & Ripple Effects
Yahoo closes out a busy stretch by buying del.icio.us, a tagging-based bookmarking service, days after it added Skype-like voice calling to its instant messenger on December 7 — an entry into a VoIP field the company itself described as suddenly crowded — and after confirming plans for an online library of books.
The purchase comes from strength rather than defense: market research cited in the coverage puts Yahoo first among U.S. home web users for news and first among portals in unique visitors. Buying a small social service extends a market leader's reach into user-generated content rather than shoring up a weak position.
First-order effects
- del.icio.us's shared-link community and its store of user-applied tags fall under Yahoo's umbrella, giving the company crowdsourced metadata about the web's most-saved pages.
- The startup's early-adopter user base becomes part of a corporate portal, with Yahoo's own description framing this as its latest acquisition of a social networking service.
Second-order effects
- Rivals named alongside Yahoo in last month's public dispute over RSS readers caching feeds without disclosing subscriber counts — Google Reader, Pluck and NewsGator — now compete against a portal that pairs the largest audience with a fast-growing tagging dataset.
- Competing portals and search engines face pressure to answer with their own social bookmarking offerings or acquisitions rather than waiting out the trend.
Third-order effects
- If the pattern holds, the small services that defined the emerging social web — tagging, sharing, folksonomy tools — get absorbed by incumbent portals instead of scaling independently, shifting where grassroots online communities live and who controls their data.
The trend: Mid-decade portals are acquiring the small social-web startups built around tagging and sharing, folding independent communities into mass-market platforms.