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Google and Yahoo – Differences in media strategies April 11, 2007

Posted by Daniel Gardner in Business Thoughts, Current Events, Google, Internet, TechCrunch, Viacom, Yahoo.
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I don’t think anyone disagrees that video content is one of the most important and influential content mediums today especially with the advent of the Internet and the wide availability of fast always on connections we now have more choice of content providers and access to shows when and how we want them.

Two of the biggest announcements in video advertising have come in the past fortnight with Yahoo announcing there online advertising partnership with Viacom and Google announcing there foray into Television advertising.

There is obviously a marked difference in these strategies, Google has gone off-line to pursue television advertising whereas Yahoo is staying online pushing there advertising out to third party advertisers.

Google are currently in a sticky situation, they have brought the Video sharing website YouTube for 1.65bn late last year and are currently trying to establish it as the go-to place for consumers to watch videos online so by Google executing a video advertising strategy that drives users away from YouTube and allows them to monetize content elsewhere this would be a serious conflict of interest with there current offering though the current lack of effective monetization on YouTube means that YouTube cannot offer content providers enough incentive to host there content at YouTube (see the Viacom v Google 1bn lawsuit), a sorry see-saw story indeed.

So what have Google done? They have started to move some of there advertising off-line, last week announcing they will be moving into television advertising, I have covered this off in my blog post Will Google succeed in the Television advertising space?, I believe this is a poor move by Google, as there focus is pulled off-line and any messaging they planned to communicate to advertisers that they believe in online video is heavily diluted.

In the other corner though we have Yahoo choosing to advertise on other companies media properties (see the Yahoo Viacom Deal) online while keeping it’s own pay for play offering that offers a clear monetization channel for media companies, not unlike Apple’s iTunes music store.

By keeping all of there advertising and media properties online Yahoo will be able to continue to focus on and expand it’s primary advertising stream while building connections with large media companies as the online media space grows.

As I have mentioned before I don’t think Google will achieve the same domination in television as it has in online advertising unless they continue to innovate while there online video offering YouTube is looking to be sinking as they are currently losing content providers due to there blatant disregard for copyright and unless they change there policies quick they may taint themselves, I feel Yahoo however is going in the right direction, maybe it won’t have the same short term success that Google may get out of there move into television advertising though at least it will be sustainable especially as more and more video content moves online.