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Yahoo’s turmoils of late have been grabbing headlines and as Susan Decker attempts to turn the ship around, there is one particularly powerful innovation that’s coming out of Yahoo: SearchMonkey and Boss .

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These two technologies enable developers to use, augment and syndicate the Yahoo search index with games, videos, and documents. More broadly it’s an experiment to take an existing and highly lucrative market , search engine marketing, and turn it on its head with crowd-sourcing.  By enabling developers/users to add details to the search results, the search results pages are richer, answers are fuller driving more traffic in the long run Additionally, these supplemented search engines can be syndicated, found on other websites. Furthermore, if Yahoo succeed, they will have a user base working for them continuously to improve the product without any overhead costs.

Looking at this effort through a strategic lens, BOSS is a Trojan horse – give the secret sauce away for free in order to get users to make it better, a device to gain marketshare and re-establish the brand by commoditizing the technology: now everyone has a search engine as powerful as Yahoo. It’s unlikely that the other incumbents in the market will be willing to copy this move, because of the possibility of revenue cannibalization.  Having more searches syndicated means cutting the revenue three ways, instead of two, reducing profitability.

Over time, every technology becomes commoditized as more competitors enter the market and develop different solutions to solve the problem. BOSS may be the harbinger of search engine commoditization and margin contraction as more developers are working to build search engines to compete with the big boys.

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