Good News for Bloggers? Yahoo Takes Aim at Google AdSense For Publishers (YHOO, GOOG)

Jan.18.06 | About: Yahoo! Inc. (YHOO)

Key quotes from CEO Terry Semel about Yahoo's plans for contextual ads for publishers (the entire transcript of Yahoo's Q4 earnings call is here):

We also believe that there is significant potential upside as we improve our monetization capabilities and our tools to publishers and advertisers. We have been quite successful in attracting large content partners and have begun to take advantage of the large number of small publishers on the web.

During the fourth quarter, we further experienced the beta of our self service Yahoo Publisher Network, which is designed to tap into that segment. The beta is ramping up nicely and we now have several thousand publishers in the program with thousands more requesting invitations.

During the quarter, we also rolled out a number of new matching capabilities that have already resulted in increased coverage and improved RPS. Overall, both our brand and search advertising businesses continues to expand. We are making the right investments in audience size, demographics and engagement as well as exciting advances in delivering even better results for our advertisers.

As we move into 2006, we will continue to invest in the services and experiences for which we’ve already received a lot of accolades. We are the Internet leader and we are well-positioned to utilize the technologies, platforms and services that will define our success over the coming years.

I would like to briefly give you an overview of our key priorities for 2006. Our #1 priority is building and expanding the suite of tools services and solutions for Internet marketers and publishers. Just as you seen us systematically build our products and platforms resulting in the world’s best consumer experience, you will see us supply the same focus to our marketing partners, and of course for good reason. We anticipate the overall Internet advertising market has the potential to double in size in the next 5 years.

In search marketing, our monetization efforts can be grouped into 3 categories. First, we are expanding our content match services through the Yahoo Publishers Network to take advantage of the growing number of small publishers on the web. We plan to add new features to beta over the coming quarters including search and enhanced ad targeting. We believe the service will ultimately position Yahoo as one of the preferred advertising partners for small and medium-sized publishers. Second, we are focused on improving RPS to better matching in relevance algorithms. While our matching initiatives will largely benefit coverage, we’re also focused on improving tools to drive higher relevance and click through. And third, we are increasing the number of easy-to-use tools for advertisers and publishers, so they can buy more keywords, touch more creative and add more listings faster.

Importantly, because of the millions of users and hundreds of thousands of partners that depend upon us, we’re going to be very deliberate about rolling out changes and improvements over a period of time.