For runner-ups to Google in the internet media market, there's a consolation prize: potential partners are so fearful of the Mountain View search phenomenon that its Sunnyvale neighbor, Yahoo, looks cuddly by comparison. That's one way to explain the success of Yahoo's dealmakers. Take the three latest coups for Yahoo's dealmakers.
- McClatchy. The Wall Street Journal reports today that the McClatchy newspaper group will, like Hearst and MediaNews, sign up to Yahoo's jobs classifieds database, and some of the internet media company's other ad services. McClatchy owns newspapers such as the Miami Herald.
- Viacom. Sumner Redstone's media congomerate, which is suing Google for $1bn in a copyright infringement claim, signed up to run text ads from Yahoo on its sites.
- News Corporation. With NBC Universal, Rupert Murdoch's media group has agreed to distribute video on all the biggest internet sites except Google. Yahoo is one of the content coalition's biggest internet partners.
To be sure, there are other factors at play here. Google doesn't have a database of jobs ads, and recruiters haven't become accustomed to using the search engine's Adwords program to promote their job listings. CBS, in its recently announced plans to distribute its video programming widely on the web, said it had not yet come to terms with Yahoo. And Panama, Yahoo's revamped system to match the highest-paying text ads against search engine results, has allowed the company to make more enticing offers to its partners.
But, just as Netscape capitalized on the exaggerated fear of Microsoft in the 1990s, so Yahoo is benefiting from the power of Google, and the paranoia of established media companies, which see the Mountain View search engine destroying their classifieds businesses, and, now, attacking the lucrative revenue from TV advertising.
Of course, Microsoft was indeed eventually hobbled by the coalition arrayed against it, which lobbied for anti-trust action against the Redmond operating-system monopoly. But its challenger in the browser market, Netscape, didn't benefit: all the deals in the world, and all the press releases, can't turn around an internet company that's losing momentum.