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BizReport : Search Marketing : October 18, 2006

Yahoo: Moves To Bolster Revenue

Yahoo’s long awaited ad-serving platform, Panama is live today. A move that along with the acquisition of AdInterax, a rich media ad company, and a 20% investment of Right Media Exchange, an online ad exchange company could help bolster sagging ad revenue.

by Kristina Knight

Yahoo reported third quarter net sales of $1.12 billion, excluding money paid to search-advertising partners. Profits were in line with analyst expectations of $159 million. Net income was reported at $235 million. In Q3 of 2005 Yahoo reported net income of $254 million.

Analysts say Panama’s easy user-friendly interface and flexibility will likely be the largest factor in the company’s rebound. "We believe that through this platform we will be able to unlock the full potential of our large global user base and improve our search monetization capabilities," CEO Terry Semel said (via MediaPost). Any financial impact from the release will likely not be seen until the second quarter of 2007.

Meanwhile Right Media Exchange’s online auction-based system will help Yahoo sell less-premium advertising by allowing advertisers and agencies to bid on impressions. The buyout of AdInterax will enable users to create rich media ads through a drag-and-drop interface.
Google and MySpace are the biggest rivals for Yahoo, but Semel says the company is up to the challenge. With the acquisition this year of Web 2.0 portals like Flickr and Yahoo is poised to become a larger player in social networking. Add to that the moves Tuesday to buy ad portals and Yahoo is poised to make a comeback from disappointing Q3 numbers.

Tags: online advertising revenue, online marketing, Panama, Yahoo

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