Yahoo Decides to Fire Its Brightest Tech Minds. Facebook Will Gladly Take Them.

By Sarah Lacy , written on March 16, 2012

From The News Desk

Yahoo is just completely crying uncle when it comes to innovation at this point.

Not only has it embraced the dark side of using vague patents to prevent others from innovating on the Web, but we hear the company is firing some of its best technology minds at the end of the month. I know what you're thinking: Yes, Yahoo actually has some great technology minds left.

The fact that that comes as a surprise is testament to how underutilized a group called Yahoo Research has been. With the stated goal of "Inventing the Future of the Internet," Yahoo Research is a collection of dozens of academics, researchers and thinkers working in a dozen or so hubs around the country.

From the Yahoo Research Web site:

"Yahoo! Research is the central advanced research organization of Yahoo! Inc., a leading global Internet brand and one of the most trafficked Internet destinations worldwide. We're responsible for big inventions-- our goals are nothing short of inventing the future of the Internet and creating the next generation of Business for Yahoo!"
Yeah, why would you want those guys around when you can just get revenues by suing competitors?

A source says Yahoo is firing at least the New York team of researchers and possibly the entire division. We haven't been able to get solid confirmation on how wide reaching this is, but the New York team will definitely be out of a job by the end of the month, our source says. (Kara Swisher presaged some of this when she wrote about the head of Yahoo Labs heading to Google a few weeks ago.)

But don't feel too bad for them: Several companies including Google and Facebook are going crazy trying to acquire the team. We have heard from a good source that Facebook CEO Mark Zuckerberg himself has been personally wooing them. (We've put calls into Facebook and Yahoo, but haven't been able to connect with a live human yet. We'll update if we hear more.)

Admittedly, academics aren't always the best at coming up with commercializable products, but these are some pretty heavy hitters. They are experts in everything from machine learning to social networking. Yes, social networking: The boat Yahoo so horribly missed that they have resorted to suing Facebook for vague patents.

Among the New York team is Duncan Watts, who directs the Human Social Dynamics group. If that name sounds familiar that's because he penned the book "Six Degrees: The Science of a Connected Age" back in 2003. You know, the book about the very theories underlying social networking.

So, let's get this straight: Yahoo had the foresight to hire all these great minds so they could anticipate where tech was going, and help Yahoo plan new products. It utterly failed to utilize them in any meaningful way. So now, Yahoo is dumping them.... so they can run into the waiting, hungry embrace of Yahoo's new arch-enemy Mark Zuckerberg?

That's a Picard face-palm even by Yahoo standards.

Combined with the patent trolling, I can't imagine a greater capitulation that Yahoo has just given up on ever creating a ground breaking new product again. What is Scott "Yahoo Will Return to Innovation" Thompson thinking?

Here's a clue: If Facebook wants a team so badly that its very busy CEO who is about to take his company public is spending his time personally courting them, maybe it's worth keeping.