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Yahoo Should Buy the AP

Ok, it looks like the Yahoo world has turned upside down, desperate times seem to be calling for desperate measures. It's pretty clear that this pesky Microsoft thing ain't going away. If you want to stay independent, you need a plan.

Yahoo has one major issue: its brand stands for nothing in the eyes of the consumer. Put another way, how would you complete the following sentence: I go to Yahoo because its the best place for ____________. Stumped you, didn't I? That's not good. It means you have no brand. If you can't fix this, then you should be put in play.

So then, what's the answer? What should the Yahoo brand stand for? Hmmmmm. Search? Nope, it's already taken. Shopping? Somebody else owns that one too. Auctions? Please. Social networking? Video? Sports? Nope, nope and nope. All already owned.

With that, the good news is that there is one category out there that is so fragmented right now (by both market and structure) that it remains open: news. Fortunately for Yahoo, that is actually a natural play for them as well. Lots of people who go to Yahoo do consume the news there. It's not out of left field. So how do they go about winning this category? Easy. Here's my 7 step plan for Jerry and company:

1. Buy the AP. Its owned by a bunch of newspapers, so this won't be easy. But, given that newspapers are bleeding badly and have a love/hate relationship with the AP, they'll actually be open to this idea. And you can make the deal palatable to them by letting them continue to use the AP content for their print editions. That's all they care about anyway.

2. Reap the traffic. Include in the deal links and summaries of AP content for the localnewspaper.com sites. Of course all of those links will go back to Yahoo.

3. Stop the commoditization of news. Discontinue the online content distribution deals beyond links. Yes, even those with places like msn.com and msnbc. News is commoditized because of the co-operative ownership of the AP. With a single owner, this isn't an issue. Own the AP content - don't make it a commodity.

4. Outsource search to Google. You lost the search war. You're not building your brand on this anyway. Take the cash infusion from this deal and use it to finance your AP deal.

5. Paint the news purple. The AP goes beyond just print stories. They have video, radio, etc. All of a sudden you own THE source of news media in the world. Make sure it all reflects the Yahoo brand.

6. Make Yahoo = news. Wrap your identity around your site being THE place to stay abreast of the news of the world, I'm talking new homepage, new overall design. You've got the distribution and now you've got the content. Make it your brand.

7. Take it to Madison Avenue. I've written ad nauseum in the past how display advertising doesn't monetize at a high enough level. This deal doesn't solve this problem but it does make it a bit better. With so many products on your site, its hard to wrap a pitch (and thus a decent CPM) around what your selling. Advertisers are comfortable with AP content. They know what their getting. No brand concerns. An expected audience. Sell the news, not peanut butter.

That's it. Btw, the AP will love this. I've met with jim Kennedy and lots of people down there in the past and its always been apparent that they want their own web presence. With you being the most trafficked site on the net, they'll embrace this plan like a long lost child.

Seven easy steps and the next thing you know your brand grows, your audience grows and you actually stand for something. Sure beats the heck out of being known as the also ran search player.

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Comments (1)

David Ruma:

Did you see Yahoo's report that they are exploring some type of alliance with Newscorp? This strategy isn't quite as independent as yours, but I agree, they need to do something. I just wonder if they can generate a better value than the MS offer. I guess we'll find out.

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