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

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 auction
structure

Google’s first major search syndication victory over
Overture: AOL

Yahoo!’s failed attempt to buy Google for $3B in 2002,
leading it to settle for acquiring Overture instead the following
year

“Project Panama” at Yahoo!, and its impact on the tech and
internet history

Overture's (and later Yahoo!’s) lawsuit against 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

The power of incentive alignment in marketplaces— and
creating the widest and deepest moats on the internet



  The Carve Out: 


Ben: The famous University of Washington's “Love Lab” Dr.
John Gottman: “The Secret to Love is Just Kindness”

David: Berlin

Brian: The Dark Valley: A Panorama of the 1930s