Battling Data Monsters at Yahoo!

Usama Fayyad is helping the Internet giant figure out how to harness the massive amount of data it collects, in ways that profit advertisers and protect Web users

by Catherine Holahan

Yahoo Chief Data Officer Usama Fayyad

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Usama Fayyad's colleagues say he battles monsters for a living. In the elite engineering circles that this former NASA rocket scientist inhabits, the job description passes for a wisecrack. But, like many jokes, there's truth behind it.

Fayyad is Yahoo!'s (YHOO) chief data officer, possibly the first person to hold such a position. His role since he took the post in December, 2004, has been to make both sense and money from the vast amounts of information Yahoo collects on the doings of 500 million people who visit its site every month.

Each day, Yahoo collects between 12 and 15 terabytes of data. This vast store includes the search keywords people type, the Yahoo pages they visit, the ads they click, the videos they watch, and even whether they scroll all the way down to the bottom of an article. Yahoo's daily data collection exceeds the digital size of the entire Library of Congress. A single terabyte alone is so massive that computer scientists named it after teras, the Greek word for "monster"—hence the humor in Fayyad's job description. "We used to call them 'terrorbytes,'" says Fayyad.

The "Data Wars"

Lately, the tongue-in-cheek explanation of Fayyad's employ seems more apt that ever. Fayyad, along with a growing number of executives at other companies who also oversee reams of data collected on their Web sites, are engaged in a major battle over how freely that information can be used to tailor ads to individuals. The monster, as even Fayyad sees it, is the potential to misuse the data—violating consumer privacy in the name of personalization and profits. "Humanity as a whole hasn't figured out how to deal with this," says Fayyad.

The battle came to a head recently with Web users and government regulators becoming involved like never before. On Dec. 5, Facebook Chief Executive Mark Zuckerberg apologized to users and changed his company's new advertising policy after more than 75,000 people signed a petition objecting to how the popular social network shared their information (BusinessWeek.com, 11/30/07).

Facebook's retreat came just a month after the Federal Trade Commission held hearings concerning "behavioral targeting," the practice of tracking a user's online travels in order to show, say, an ad for mortgages and home-equity loans to a person who recently visited a real estate Web site. And on Dec. 11, IAC/InterActive's (IACI) Ask.com search business responded to the mounting worry by announcing a tool that enables Web surfers to erase their keywords from the company's database.

Jeff Chester, executive director of the Center for Digital Democracy, a nonprofit consumer advocacy group, says there's more public outcry to come. "The technology is an unstoppable force able to collect data and target users throughout the ubiquitous off- and online landscape," says Chester. "This is just the beginning of the data wars."

If anyone seems ready for such a fight, it's Fayyad. Built like an oak tree, Fayyad's towering 6-foot 5-inch frame would make nearly anyone think twice about trying to push him around physically. More important, with a PhD in engineering, two master's degrees in computer science and mathematics, all from the University of Michigan, he knows just how much—or how little—data is needed to reach a marketer's objectives. When he confidently promises that he can help an advertiser target Yahoo users looking to purchase a new red truck in Montana without revealing e-mail addresses or other personal information, it's hard to doubt him.