Terry Semel, executive director of Yahoo, tells
CNNMoney about the unique “universal megaport” business model.
Terry Semel joined
Yahoo in 2001 immediately after the crushing “dot-com crash” that shook the whole of America. However, the most popular portal Yahoo managed to survive this crisis and maintain its leadership until now.
The director of the largest Internet company performs the task set before him to transform Yahoo into “the first media titan of the 21st century”. The basic strategy of the company is to maximize the audience of the portal, using all possible services and constantly improving their quality. Over the past year, Yahoo has become the only major Internet company that has managed to significantly increase such a parameter as the average time spent by users on the site.
This was made possible by adding new services and increasing the “depth of surfing” on the site. One example of increasing “depth” is the
Yahoo Music service. Initially, this service was no different from similar services of competitors, but the developers added the ability to exchange playlists between users via an IM pager. The result is a more personalized service where people spend more time. Characteristically, Yahoo Music is even more profitable than
Apple's most famous online music store, because the latter sells songs for a meager price of 99 cents and earns almost nothing from it. Their main goal is the sale of players.
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Yahoo's business model is completely different. They sell advertising and aim to attract as large an audience as possible. In this sense, Yahoo’s competitors are more like the services of a new generation of
MySpace and
YouTube . However, Yahoo has something to respond to competitors in the spirit of the web 2.0. For example, more than 50 million people are participating in the new social search service
Yahoo Answers , and this “game” is very popular among young users, which is very important.
The company Yahoo all the first half of this year created the infrastructure for broadcasting video content, which should be an important part of the news, sports and other sections on the portal.
This year, Yahoo predicts revenue growth of 29%. This is much less than 42% last year and 77% in 2004. High hopes are being placed on the
advertising platform of the new generation Panama , which should correct the situation and increase the profits from search advertising. Unfortunately, the release of this platform is constantly delayed.
Not all questions to the president of Yahoo dealt with business. There were questions and personal plan. For example, it is known that Terry Semel loves to play tennis, and often does so with his friend Rupert Murdoch, media magnate and owner of News Corp. When asked which of them wins more often, Terry answered diplomatically: “We play in pairs, so it depends on which side the professional plays on.”