Yesterday, during Yahoo's second-quarter earnings call, Sue Decker cited Yahoo's newspaper deal as an example of "how our commitment to being the industry's partner of choice is gaining traction." Her proof? The consortium teaming up with Yahoo now included 17 companies publishing "nearly 400 daily newspapers." Putting together a coalition is one thing; actually making money is quite another altogether. Today, Google announced they are expanding their effort to broker newspaper print ads to more than 225 papers. So is Decker, Yahoo's no. 2 executive, right in touting the number of papers it partners with a a sign of "traction"? It's not that simple. Yahoo doesn't do simple.
Google began its campaign to woo the papers first, in November 2006, with a very limited test: Only 100 advertisers and 50 newspapers, and it only involved advertisers shifting online ads to print. Yahoo responded quickly with a more ambitious plan. At least in theory. The initial phase involved some 176 newspapers posting employment ads to Yahoo's HotJobs website, and the newspapers using HotJobs technology on their own career-listing webpages. The goal, down the road, was to share advertisers with the papers and also lock in content-distribution agreements to bolster Yahoo's websites.
In April, Yahoo showed the first signs of moving towards its goals. It announced that its newspaper alliance had grown to 264 papers and claimed "the newspaper industry's first full-fledged integrated online advertising network." The grandiose plan involved four initiatives: having Yahoo serve ads to newspapers' websites; letting Yahoo's sales force sell newspaper ads to their advertisers and letting newspaper salespeople sell local ads on Yahoo; placing Yahoo's search into newspaper websites; and distributing newspaper articles across Yahoo's network.
Yahoo's advertising plan, on the surface, appeared more far-reaching and ambitious than Google's experiment. But the reality? Google's moving faster than Yahoo, thanks to its more modest short-term goals. Back to Decker's comments yesterday:
We've launched 49 Hot Jobs co-branded career sites and have an exciting product road map which includes display and search advertising, distribution of newspaper content on Yahoo!, and cooperative sales opportunities.49 career sites? That only reaches one out of eight of Yahoo's partners. Road map? What happened to "the newspaper industry's first full-fledged integrated online advertising network" touted in April? What, in other words, has Yahoo actually accomplished?
Meanwhile, Google was quietly preparing to launch print ads to its simple, well-known AdWords system to hundreds of thousands of its loyal advertisers. Without involving the complications of cobranded job websites, content agreements, and sales forces, Google can become an actual, not aspirational, "partner of choice" by allowing newspapers to keep most of the revenue and enticing advertisers with $1,000 in money to spend on newspaper print ads. And content distribution? It's hard to find a better deal than Google News, which actually drives tons of readers to newspapers' websites without charge.
Yahoo touts elaborate plans and extensive partnerships, but we've heard this all before. And Yahoo has failed to deliver, time and again. Google, by contrast, continues to succeed by quietly growing and delivering simple plans that benefit its business partners, to the surprise of rivals and investors alike.