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Hot on the heels of Yahoo!’s better-than-expected earnings report, the search company has revealed new plans that will change their social networking strategy. Instead of continuing to pursue Yahoo! 360° as a social networking spot, Yahoo! will open its platforms to external developers, allowing users to unify their various services and choose from third-party applications to create complete profiles. This will give Yahoo! users just one location for all their functions, including email, calendars, news, photo storage, and instant messaging. With Microsoft’s takeover offer looming, this strategy may help Yahoo! redefine their services for the new generation of internet users.

PC World has reported this development from the Web 2.0 Expo in San Francisco Thursday, where Ari Balogh, Yahoo’s chief technology officer gave a keynote address. Balogh said, “”It is rewiring Yahoo from the inside out, across all of our properties, to fundamentally open up those Web services and provide a consistent development model, a consistent deployment and consumer experience as well.” If all goes well, the strategy has the potential to unite hundreds of millions of people who use Yahoo!’s email and messaging services in a social setting. It could potentially give Yahoo! the boost they need to compete with social networking giants like MySpace and Facebook, both of which are open to outside developers creating applications for use within their sites.

Yahoo!’s APIs (application programming interfaces) have been available to developers on a limited basis in the past, but this move is much more broad, and will hopefully create a streamlined process like that provided to third-party Facebook developers. With Yahoo!’s recent acquisitions of Flickr (photo sharing site), Del.icio.us (social bookmarking site), and Upcoming (calendar sharing site), the combination of services into a single dashboard could be quite appealing to users. Third-party applications could include anything from games, blogging tools, file sharing, and a variety of other popular social networking tools. As Balogh said in his address, “We are not building another social network. We are building social into everything we do.”

The first piece of Yahoo!’s puzzle that will be opened up to developers is Search Monkey, which will give outsiders a look at their search technology. Users and developers will be able to customize and tweak search results, as well as applying SEO techniques to bump them up in Yahoo!’s rankings. A senior researcher at Forrester told the BBC, “My hat goes off to Yahoo that they have been able to execute this in a very difficult and stressful time for them on a strategy that I think is potentially very interesting.” Indeed, with Microsoft’s deadline for their takeover offer looming, Yahoo! has shown no signs of slowing their progress.

Their earnings report released earlier this week shows a 9 percent increase in revenues and an 11 percent increase in profits over last year’s first quarter. Yahoo! executives no doubt hoped this news would solicit a higher offer from Microsoft, but the software giant has not backed down. Tomorrow will be the deadline for Yahoo! to begin talks, and Microsoft has threatened to go hostile if an agreement is not reached. Microsoft CEO Steve Ballmer has indicated that the offer may be taken directly to Yahoo! shareholders, bypassing the company’s management.

We all love an underdog, and many in the technology community are rooting for Yahoo!. The new social networking strategy will likely win them even more fans, and potentially give them the bargaining chip they’ve been looking for.

Friday, April 25th, 2008 You can skip to the end and leave a response. Pinging is currently not allowed.

By Haley January Eckels