Yahoo puts meat on Open Strategy bones

SAN FRANCISCO--After months of preamble, Yahoo on Monday flipped the on switch for a massive project to increase activity--and advertising--on its Internet sites through social connections and online applications.

The company has been working mostly behind the scenes to build what it calls the Yahoo Open Strategy, but now the strategy's changes will become evident to U.S. users of some of Yahoo's main properties such as Yahoo Mail, My Yahoo, and Yahoo's music and TV sites. In addition, the company will begin previewing a new Yahoo Toolbar later this week.

John Kremer, vice president of Yahoo Mail

(Credit: Stephen Shankland/CNET News)

"We wanted to establish a social dimension," Ash Patel, executive vice president of Yahoo's audience products division, said of the Yahoo Open Strategy goals. And to attract programmers who can build applications on Yahoo properties, "We wanted to engage with the developer community and to open up the power of Yahoo's products and platforms."

Yahoo Mail, which according to ComScore has about 275 million active users each month, gets some significant changes, with more to come. First is a new welcome page that now spotlights messages from people in a person's Yahoo social network and invitations from others to join their networks. And the in-box page now includes a new "from connections" button that shows e-mail only from those social connections.

Second is the arrival of online applications tied to Yahoo Mail. One inaugural program from Xoopit lets you view all the photos in your e-mail archive, even expanding links to online galleries. Another lets you convert an e-mail message into a WordPress blog post in two clicks.

"The opening of the mail platform is a huge benefit to users in terms of the additional forms of sharing and communication we can build in and to the developers who can build applications," said John Kremer, vice president of Yahoo Mail, speaking to reporters at a launch event here.

More mail changes are coming, he said. Among them will be birthday reminders and the ability to exchange large files, Kremer said.

The new mail abilities require a the cooperation of Yahoo users' contacts: they must agree to be listed as your contact before they can become a part of Yahoo social activities. That's because of privacy considerations, Kremer said. For example, the right-hand side of the new Yahoo Mail welcome page also shows contacts' activity such as photos posted, movies recommended, or applications added, and that's information those people might not want to share with just anyone.

Yahoo Mail's new welcome page spotlights activity from a person's social connections. (Click to enlarge.)

(Credit: Yahoo)

Leapfrogging the Joneses
It's not all fun and games. Building use of Yahoo into members' social lives and letting them use applications housed on Yahoo sites means more advertising for Yahoo. That was important earlier this year when the company was stagnating financially, but it's even more important now that the recession has put extreme pressure on the ad market. And Patel believes the ads that can be delivered with the social context--for example clicking on the Yahoo Music page for an album a friend just rated highly--will provide valuable context for advertisers.

"Targeted (ad) inventory sells better than untargeted inventory," Patel said.

The Yahoo Open Strategy theoretically could help Yahoo not just keep up with the Joneses, but leapfrog them. Although Yahoo capitalized on the first generation of online social activity, e-mail and instant messaging, it lagged rivals such as Facebook when it comes to letting people build online communities of friends and business contacts. Yahoo's new strategy, though, is tuned to its own assets.

Google has got a powerful search engine, but its online community is nascent compared to Yahoo's. Facebook and MySpace have got social ties, but not Yahoo's breadth of finance, sports, entertainment, news, and communications. Yahoo Open Strategy is a recipe not easily reproduced in full by Yahoo competitors.

The hard part will be bringing the transformation to fruition fast enough.

For the Yahoo Open Strategy to pay off, the company must encourage its members to register new profiles and to link their friends into their social network. And it will have to coax a lot of programmers to build good applications then coax Yahoo members to activate them. All this takes time, and Yahoo, with Microsoft and Google breathing down its neck, doesn't have the luxury of time.

Getting people to sign up for yet another social service--Yahoo strenuously objects to calling its work just another social network--is another hurdle.

"There is going to be some fatigue on that process," Kremer said of people getting inundated with a new round of online service invitations. "It may slow down the virality of what we're doing."

But the company believes it will spread because people will find it useful. And unlike some services, Yahoo hopes people only set up their service with a small number of important contacts rather than compete for the biggest networks.

"I don't want my users to sign up for 500 connections," Kremer said. "I want this to be for the tight inner circle--those five or ten or fifteen people they scan for" when checking their in-box.

Yahoo Mail is getting a Flickr application that lets people upload photos from the e-mail application. (Click to enlarge.)

(Credit: Yahoo)
Source : CNet News

'Brief delay' for Yahoo-Google search-ad deal

Yahoo and Google are delaying implementation of their search-ad deal to give Justice Department antitrust investigators more time to look into the deal, according to published reports.

Kara Swisher (of All Things D) and Bloomberg reported the delay Friday afternoon.

A Yahoo representative said the company is preparing a statement; Google didn't immediately respond to a request for comment.

Under the Yahoo search-ad deal with Google, which had been set to go into effect this month, Yahoo plans to display some Google search ads where its own ad-delivery technology doesn't work as well. Yahoo expects $800 million in new revenue in the first year of the deal.

Update 2:57 p.m. PDT: Yahoo and Google confirmed what they characterized as a "brief delay."

"The companies have agreed to a brief delay in implementing this agreement to continue our ongoing discussions with the Department of Justice. We have had discussions with regulators and look forward to responding to their questions about this agreement," Yahoo said in its statement.

Google added this: "When we announced our advertising agreement with Yahoo in June, we agreed to delay its implementation until October to give regulators time to look at the details. As we are still in conversation with the Department of Justice we have agreed to a brief delay in implementing the agreement while those discussions continue."

Update 4:01 p.m. PDT: Yahoo wouldn't clarify how long the brief delay would last, but the companies likely want it done before a new administration is elected one month from now and major changes could take place within the Justice Department. The Reuters news agency quoted an unnamed source who said the companies still expect to begin in October.

The companies gave themselves three and a half months to implement the deal, saying they wanted to give antitrust regulators time to review it. With the June announcement date, that would have put them in early October.

However, the companies haven't been specific about when they planned to flip the switch. In a September meeting with the press, Google Chief Executive Eric Schmidt wouldn't be pinned down beyond "roughly the beginning of October."

The partnership has come under antitrust criticism from Microsoft--whose unwelcome attempt to acquire Yahoo helped fuel the Yahoo-Google partnership--and from the Association of National Advertisers (ANA), the World Association of Newspapers (WAN) and Center for Digital Democracy. The European Union is investigating the partnership, too.

Some Democratic lawmakers from California, though, urged the DOJ not to block the deal. They criticized in particular the possibility of Justice Department legal action before the deal actually takes effect.

Facing the criticism, Google and Yahoo both have begun a publicity offensive. Google published a frequently asked questions site, and Yahoo President Sue Decker weighed in with her own defense last week. Yahoo has also published a site with partnership details to try to make its case.

Update 4:22 p.m. PDT: Several states are reviewing the deal, too, and Connecticut Attorney General Richard Blumenthal said there's been a two-week extension of the antitrust review. The deadline for review moved from October 8 to October 22, Blumenthal said.

"We are doing our review in conjunction with the DOJ, so I'd think our timetables are aligned," Blumenthal said.

Although it's notable that Yahoo and Google are giving antitrust regulators more time to review the deal, it's a step that other companies have taken in the past, as well, former DOJ antitrust attorneys said.

Deadlines can be pushed back as needed. One former attorney said companies usually are happy to give regulators more time to evaluate a transaction rather than push the issue for fear it will back the regulators into a corner and cause them to file a lawsuit to block the deal. Another source said delays are part of the natural ebb and flow of negotiations.

The top brass of the Justice Department's antitrust unit met with Google and Yahoo months ago, a departure from the more traditional path in which the DOJ staff issue a recommendation to the department's front office about whether a deal should be rejected. Traditionally, only then do the companies make their case before antitrust chieftains.

Source:news.cnet.com