Beyond bad news: There’s more to the story of Yahoo, Twitter, and Volkswagen

It’s the mid-90s, and I’m visiting a colleague’s house after work. He has an account with an Internet service provider; I don’t, and he has offered to show me what’s out there. So he fires up his computer, and we chat over the hiss, squawk, and chime of two modems flirting by phone. Once they’ve mated, they fall silent, and we turn our attention to the Netscape Navigator web browser. My pal has already discovered and bookmarked a number of sites on the World Wide Web that interest him. He shows me a few, and then I, impatient for a broader view, ask him if there’s a directory of some kind, like the ever-growing lists of computerized bulletin-board systems. How do you find a new place to go on the web, if you don’t know about it ahead of time? Simple, he says, taking us to a page with the excitable name “Yahoo!” at the top. The whole thing is simply a handcrafted list of other websites, organized into categories—just what we want.

Flash-forward to the present: The little directory that was started by two Stanford grad students in 1994 is a big company employing more than 10,000 people, and I just began working for it. Was this a smart move? Have I gotten on the up elevator, or the other one? In recent years, Yahoo (I’ll skip the exclamation point) has often been in the news for negative reasons. In 2008, when its board rejected Microsoft’s offer to buy the company for $44.6 billion, the decision was criticized by many as a mistake. When Marissa Mayer was hired as CEO, in 2012, the oft-repeated question was whether she could turn the company around, implying that its fortunes were falling (which they were, from a certain analytical point of view). The wisdom of rejecting Microsoft was questioned again in 2016, when Verizon announced it would buy the company’s core assets for $4.8 billion. Last September, Yahoo reported a huge breach of user data, and in December it revealed an even bigger breach. Last week, a Vanity Fair post described Yahoo as “a flailing relic of the Internet of the 1990s that never quite figured out how to be a 21st-century tech company, even under the leadership of the wunderkind Google alum [i.e., Mayer].” One might wonder whether the whole operation is going down. One might think the same thing about Twitter, which for more than a year has been said to be dying (see, for example, here and here), or about Volkswagen, which for more than a year has been engulfed in an ugly and expensive scandal over the emissions-test cheating of its diesel cars.

But the big news about big businesses isn’t always the whole story. Reports of Twitter’s death have been greatly exaggerated. It still has tremendous value for many millions of users, among them President-elect Donald Trump, and a January 12 Verge report on the mood inside the company observed that “thanks largely to his victory, Twitter has never been such a vital source of news and conversation.” Volkswagen is still manufacturing vehicles—lots of them. The emissions scandal erupted in September 2015, but in the first half of last year, Volkswagen made and sold more cars than any other company in the world. And Yahoo, according to Wikipedia (which cites two sources), is “the highest-read news and media website, with over 7 billion views per month, [and] the sixth most visited website globally, as of 28 December 2016.”

Working for a large outfit has its perils. Big companies present a larger surface to the elements; a tailwind can speed them ahead of a ship with smaller sails, but a crosswind or a headwind will affect them more too. When they make changes, they tend to be big ones. Condé Nast, where I did most of my work for more than 15 years, is restructuring the editorial-support services—copyediting, fact-checking, photography, and design—for its print publications, with the aim of saving tens of millions of dollars a year. (Time Inc. and Hearst have also reorganized.) A few jobs have already been cut; more cuts are likely. Apparently Condé Nast’s digital operations won’t be affected. Digital publishing looks like the way to go—Axios, whose slogan is “smart brevity,” is just one of the digital ventures that have been announced or launched recently—and digital publishing is what I’m part of at Yahoo. But digital is no safe space either, and lean little ventures are just as susceptible to upsets as big ones are. Early this month, Medium, which is both a publisher in its own right and a platform for other material ranging from blogs to digital magazines (in the industry lingo, it’s a “platisher”), laid off a large proportion of its numerically small staff, and it’s rethinking its entire strategy.

In a nutshell, the problem for publishers is advertising—at least it is if you rely on ads, which almost everybody does. Readers are spread across a growing number of outlets but are mostly gathered in a few places; advertising, likewise, is both diffused and concentrated. Both developments are addressed in a recent book by Tim Wu called The Attention Merchants (published last October in the U.S. and this month in the U.K.), which was the subject of a combined review and interview in The Guardian posted on January 8. Wu’s book looks at how the attention of consumers has been caught and sold by a succession of communications technologies over nearly two centuries, “from [The Sun] in 1833 to BuzzFeed, Instagram, Google and Facebook today.” From Wu’s point of view, we shouldn’t be surprised by how the quest for eyeballs and ad dollars is playing out online—the dominance of a few companies simply repeats earlier cycles. If you’re not Amazon, Facebook, or Google, how do you make the Internet pay? Wu has no answer, at least to judge from the Guardian article; he simply makes the pithy remark (on the related issue of privacy versus commerce) that “you will not win trying to fight a running battle with the forces of commerce.” Where digital publications are concerned, it looks to me as if subscriptions, either alone (common before the launch of The Sun, nearly 200 years ago) or in combination with ads, are making a comeback; I already pay to read The New York Times and The Economist online. The shareware model—free but with contributions invited—is also spreading; like Wikipedia, NPR, and PBS, all of which ask me for donations now and then, the Guardian site where I read about Wu’s book said, “If you use it, if you like it, then why not pay for it?”

Whether or not Yahoo is a “flailing relic,” it’s giving me more work and better pay than I had been getting. (That’s not meant as a criticism. It’s a consequence of the nature of the work I was doing versus what I’m doing now.) Besides, I think it’s kind of cool to be working at an Internet company that’s been around for more than 20 years and is among the first I ever heard of. It seems like a good move in the short run. Beyond that? As John Maynard Keynes said, in the long run, we are all dead.