"Openness is the yin to Jerry Yang's Yahoo"

Yahoo Reaches Out For Ad Partners

By Jessica Guynn, Los Angeles Times Staff Writer
September 13, 2007

The search firm's deal with Bebo is the latest in its push to sell ads beyond its own sites. Openness is the yin to Jerry Yang's Yahoo. For its first decade, Yahoo Inc. grew by attracting more and more people to its stable of websites. Now, with its co-founder and new chief executive at the helm, it's reaching out to find advertising opportunities elsewhere on the Web.

Yahoo and the other major portals are now all working strategies to place ad inventory on the entire web, not just within their own domains.  Their short-term focus appears to be paying lots of money to sites like Bebo in order to “buy” the right to place ad units.  But doesn't that seem like an expensive, non-scalable way to go in the long run?

I'd like to think that the KickApps platform presents a much more cost effective, long-term model for the way Yahoo (and other portals) might “earn” real estate on 3^rd party websites---by providing those sites a range of media functionality and, in turn, helping them build incremental page impressions. 

In an earlier blog I described all this as an “Open Portal” strategy, the idea being that portals need to open up (distribute) their content and functionality to web publishers if they wish to effectively compete for advertising real estate off their domains.

I'll repeat my favorite analogy:  Think of the way NBC earns the right to insert ads on 3^rd party television stations by providing them television shows.  Imagine if NBC provided only ads to television stations (e.g. no television shows).  Clearly the “adsense model” would not work for television networks and it won’t work indefinitely on the Web.  And so it won’t be long before Google (and others) begin to think about packaging hosted applications with their ad programs to earn publisher loyalty.   In a nutshell, that's what KickApps is all about.

Comments

[WebAlong]

I'm beginning to see your wisdom here, Eric. You certainly have earned what you describe in your analogy.

Great things here and to come.