Waitt, Yang think beyond the box
Gateway's CEO and Yahoo's co-founder explain how they hope their deal will evolve to extend beyond simplifying and customizing the Net experience for PC users.
Gateway and Yahoo said today they will offer a co-branded default home page for subscribers to Gateway's ISP service, called "gateway.net." This will help easily funnel Gateway users to the Yahoo site where they can personalize their Web surfing with such information as updated national news, sports, financial information, and local weather reports.
Yang, Yahoo's chief "yahoo," and Waitt spoke with CNET News.com today to explain their hopes the deal will evolve to extend beyond simplifying and customizing the Internet experience for PC users. Both executives hope the agreement is a jumping off point for providing consumers personalized information on devices as diverse as cable-set-top boxes, handhelds, cell phones, and more.
A number of PC companies have secured deals with portal players to simplify the Net experience for consumers--with one side benefit being that portals are able to build traffic, while PC companies see a residual revenue stream from PC sales. But both have to deal with a future where a wide array of non-PC digital devices need to be networked in a home and office to share information.
"Today is only the beginning of this relationship," said Yang. "A lot of the reason we took as long as we have is not because couldn't make an announcement earlier. Rather, it's because we wanted to work on a 'barrierless' sharing of data" across a growing array of devices, he said.
For example, a Gateway customer might buy a PC with a dial-up modem, but might upgrade to a cable modem in the future; Yahoo wants to be able to automatically customize content for a broadband environment when that upgrade occurs, he hypothesized.
Looking into the future, industry analysts are suggesting that portals are the desktop of the future. (See related story).
Cable companies and their affiliated access providers, either @Home or RoadRunner, are fighting attempts to get them to sell their new high-speed Internet connections to competing service providers such as America Online and portal players such as Yahoo. (See related story)
Yahoo's president and COO, Jeffrey Mallet, said the company would likely seek out deals with access providers. Why will the cable companies open up their doors to Yahoo? Mallet said the key is Yahoo's 35 million registered users.
"We anticipate good companies will listen to that and give customers a choice. We plan to be one of the choices they want to pick," he said.
Yang was more blunt, saying that with competition from DSL and wireless providers, cable companies would be crazy to only offer one portal option. "They risk losing market share otherwise," he said.
For Gateway, the issue is also one of partnering. Waitt said Gateway is working on partnerships with cable access companies. The deals could resemble those that Dell has done, in which a customer ordering a new PC has it customized to include a cable modem. (See related story)
The main benefit for cable companies is that the cost of acquiring a new subscriber is lowered with a partnership--cable companies would only need to install a line to a house, and wouldn't need to spend costly time opening up a computer and installing the cable modem and other equipment.
Gateway company is also poised to offer DSL service through its new partnership with UUNet, which is providing the network for the gateway.net service.