Yahoo's ex-CEO Terry Semel

Yahoo might have failed in its bid to acquire social networking giant Facebook, but it is still the most trafficked website on the Web. Over the years they've built and acquired many of the most popular Internet services, yet in recent times people have begun to doubt the company's ability to compete against the likes of Google.

Now, with co-founder Jerry Yang replacing Terry Semel as CEO, Yahoo seems to be rethinking its game plan and pondering how it can regain the luster it once had. In light of Facebook's success with their revolutionary Platform, I believe Yahoo should find a way to open up and allow developers to build full scale services for Yahoo's 412 million monthly visitors.

Building and buying a diverse array of Internet service once worked well for Yahoo, but the way people think of web services is changing. Most new Web 2.0 services seem to have much more potential as a Facebook application than as an standalone service. If one of the current Internet giants opened up their own platform and figured out a way to make it as easy to use and develop for as Facebook's, then I think they would have a huge advantage over the way things currently work.

Instead of going out and buying all the popular Web 2.0 services, why doesn't Yahoo simply make it easy for people to develop the next big service in Yahoo's "walled garden"? This could be a way for Yahoo to reign in their popular services and discover the cohesiveness they need to compete in the evolving Internet environment.