(December 14, 2001) The
various online recruitment markets and some related components of the HCM
industry are poised for significant growth in 2002. At the same time, Yahoo's
unanticipated bid for HotJobs shuffled the playing field significantly. You can
tell that our industry is still primitive by the simple fact that a single
acquisition play can reorient so many assumptions and expectations.
At the core, the Yahoo move is interesting
It reestablishes industry valuations at five
times revenues while threatening TMP's continued ability to field an
acquisition engine, thus forcing TMP to immediately reexamine its growth
It focuses attention on HotJobs strengths as
an enterprise software developer placing BrassRing, Recruitsoft, Lawson,
Peoplesoft and SAP in a position of having to escalate their development
It highlights the power of the Hire.com model
which delivers real recruiting functionality as opposed to the enterprise
players reiteration of unused, low value Applicant Tracking functionality.
It removes the crown jewel from the
CareerBuilder play through the elimination of resume database development on
Yahoo forcing the newspapers to dig deeper in their "save the
Recruitment dollar" tactics.
It underscores the strategic importance of
RecruitUSA as a gateway (although HodesIQ is nipping hard at their heels,
RecruitUSA maintains a contractual lock on the middle of the playing field).
It illuminates the value of stand alone
revenue sources (like salary.com).
It reaffirms the growth vectors in the HCM
industry overall and recognizes the value of deep relationships with
It puts SAP on notice that the battle for
corporate relationships will be fought department by department suggesting
that the time to move their HR business forward was indeed yesterday.
It indicates the likelihood of a
comprehensive AOL entry in the arena that utilizes the entire integrated set
of media properties and distribution.
It virtually forces Microsoft to make a large
investment in the arena.
It underlines the timidity of the newspapers
investments in the arena.
It forces Peoplesoft to question its
commitment to HR vision and consider a deeper investment strategy.
In general, the move reinvigorates the
investment climate by pointing to the real payoffs (which are still several
Obviously, we'll be investigating the next couple
of levels of implication in the 2002 Electronic Recruiting Index.