Yahoo CTO on what it takes to compete

Raymie Stata says Yahoo's technology accomplishments sometimes get overlooked

Since his appointment as Yahoo's CTO last June, Raymie Stata has been on an intense ride. He is part of the executive team charged with building Yahoo's technology strategy and spurring innovation to drive growth and attract more users to the site. Stata has been with Yahoo since 2004 and was previously its chief architect. Other members of the team include Chief Scientist Prabhakar Raghavan and Stata's boss, Chief Product Officer Blake Irving, both of whom report to CEO Carol Bartz.

At the same time, Stata is learning the ropes as CTO, a role Yahoo redrew after last year's departure of Ari Balogh, who was CTO and also chief product officer. IDG News Service talked with Stata recently about his challenges and accomplishments as CTO, and about what Yahoo is doing to jumpstart innovation in 2011, a pivotal year for the company. An edited version of the interview follows:

IDG News Service: What do you focus on as CTO?

Raymie Stata: The CTO role has changed quite a bit recently at Yahoo. Historically, it had been an operations CTO, head of all engineering. Now we have a [separate] CPO and CTO and shifted into a functional model for the CTO. I set the technology direction but don't actually manage all the engineers. That's a big shift for the company. We're still working that out.

An important focus area for me is technology exploration and advancement, which involves looking at new ideas and doing early R&D work to get [projects] off the ground.

Within technology exploration, mobile applications is one area of focus. We're looking at tablets as a proving ground for Web experiences of the future. We're pushing our advance innovation thought and development in that direction, versus on the PC side.

I also focus on our content platform. It's an extensive back-end content management, personalization and optimization system that we've been building over the past 18 months. It will power everything we do, on PCs, mobile [devices], tablets, across the board, and also all types of content. Bringing all our content together in a very powerful platform is a huge area of focus for us. This year you'll start to see a lot of innovation coming to market because we have that underneath us.

Another area of focus is cloud. We're on our second generation of cloud infrastructure here. Hadoop is part of the story but it's not all. There's a lot going on under the covers.

IDGNS: You've been on the job for about eight months. What's been your biggest challenge and your biggest accomplishment so far?

Stata: The last eight months haven't been business as usual in terms of my new role as CTO. With Blake and a lot of new talent coming on board at the executive level, we've spent a lot of time looking at the market, looking at our assets and strategizing.

When you do strategy, it's easy to get wrapped up in the grand and glorious three-year view. While we have a [long-term] view, we're also focused on how to connect that back to this quarter and next quarter so that we can advance user engagement. The number of users and top line [revenue] are critical focus points for the company in 2011, so that we can deliver against those important [goals] in the context of where we want to go as a company versus where we've been. The leadership team has not only articulated a strategy that makes a lot of sense for Yahoo but also thought really hard about how to execute against that strategy.

We're getting into a regular execution rhythm which is nice, and for me it's an opportunity to stick out my head and say, now that we have some direction, what is this CTO job? I've been operating more as a member of the leadership team than as CTO per se.

The biggest challenge for me is getting a bit out of the weeds. As chief architect, I was pretty deep down into the code of what we do around here. That's always been my approach: to dive in where there's a critical strategic issue that's stuck, survey what we're doing and unstick it.

That's a great thing for a chief architect to do but a CTO needs to provide a lot more visibility in terms of, what's the road map of the company, what's the technology direction and strategy. It needs to provide that, first and foremost, inside the company, because we have a lot of people who need to align to that, and also outside.

For the leadership team and myself, top-line growth broadly defined in terms of dollars and users and user engagement is a focus this year, but as CTO it's important for me to not hit the end of 2011 and not be on a ramp for the future. As CTO, I need to make sure we have a pipeline of technologies that mature at just the right time and to be looking one, two and three years ahead to make sure we're anticipating changes and building the right capabilities.

IDGNS: Yahoo has been criticized in recent years for lacking technology innovation and vision, and letting competitors capitalize on hot trends like social networking, video sharing and microblogging. Do you agree with that criticism?

Stata: There are important elements of truth in that criticism. As part of that strategic process that I mentioned earlier, that was a first-order question for us. But that criticism doesn't account for everything we've done and is therefore a bit unfair.

Something that's visible is what we've done in the advertising side. We saw [ad] exchanges and their many variances in terms of demand-side and supply-side platforms. We saw those trends early and made huge investments, including acquisitions of market-leading companies, which were integrated very well [into Yahoo]. We've done tremendous scientific and technology achievements that we've poured into that platform. I don't think we get recognition for being out ahead and for the innovation that we brought to that market.

Internally, we're on our second generation of cloud computing that is very innovative. One bit that we made external, Hadoop, has taken off and is fundamentally changing the large-data space as an industry.

On top of that cloud, we're building a platform for content ingestion, enrichment, relevance and personalization, that is second to none in the industry. We bought Associated Content so we can fuel that, in addition to having enormous content relationships ourselves and great original programming. On top of that platform, you'll see much more consumer-facing innovation coming in 2011.

Those are some things we've been doing that either people haven't seen because we haven't told them about it or maybe they haven't given us as much recognition as we deserve.

Having said that, when it comes to new product categories and deeply innovative features in existing product categories, Yahoo hasn't delivered and the first step in getting better is to acknowledge that. In strategy conversations late last year, we did acknowledge that, and we've put in place innovation programs inside the company to support the development of new product categories and of very innovative features.

I don't think we'll be turning out two "home runs" a year, if a "home run" is a Facebook, but you'll see us: a) putting out innovative stuff and b) fostering that over time, which is very important. A struggle companies face with innovative new product categories is that you get that early hit, and it's the coolest thing ever, but then you get to year two or year three and then it's not [as cool] anymore, yet you have to continue to invest in it. We recognize that as another pitfall to innovation and are prepared to create a structure that makes sure we see it through.

Copyright © 2011 IDG Communications, Inc.

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