For a very long time, Yahoo Inc.’s (Nasdaq: YHOO, stock) revenue which depends heavily on online advertising has been more on stagnant mode, thanks to Google’s (Nasdaq: GOOG, stock) sudden assault via its Adsense secret weapon. Yahoo’s YPN, the equivalent to Adsense could only looks in dismay and was left to eat the dust from Google’s speedy Gonzales. Yahoo tried to counter-attack by announcing the next generation of online advertisement framework with the launched of “Project Panama” but it didn’t take long for stocks investors to realize the new project is taking longer time that it’s suppose to be.
One of the success factors which make Google’s Adsense the most profitable cash-cow program ever created in the online advertisement industry is the sophisticated-algorithm which has high relevance to the publishers’ content. High relevancy of ads to the content will translate into high click-through rates which in turn make more money for both publishers and advertisers – a win-win business situation. It was estimated that Google’s ability to draw more advertisers and show the right ads to searchers lets it earn about 40 percent more from every search than Yahoo does.
If the news of Yahoo last week is anything to goes by, publishers could be having more fun when the actual objective (if there’s any) of Yahoo is made known later. Yahoo! Publisher Network announced last week that its’ existing publishers now have the option to be paid via PayPal, rather than by check or by electronic funds transfer. Not only that, existing publishers who opt for payment via PayPal will enjoy a reduced payment threshold, from $100 to just $50. This will definitely score a point compare to the minimum payout of $100 from Google’s Adsense, not to mention Adsense still doesn’t recognize PayPal after numerous requests from publishers.
More importantly, does Yahoo plan to go global finally? One cannot deny the fact that global advertisers and publishers both contribute to Google’s coffer. Yahoo has been confined within its’ own boundary of U.S. soils, a not so smart business decision considering that cyberspace is already the ultimate market-place for the remaining time to comes – regardless you like it or not. I believe if Yahoo indeed has the plan to open up its’ door to everyone world-wide, it will not only benefits it’s existing shareholders but all the publishers and stock investors who are looking to invest in another Google-equivalent candidate.
June 3rd, 2007 by financetwitter
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