Along with its earnings report, Yahoo faces all sorts of unpleasant questions – most of them about ad revenues and video competition.
On the ad sales side, Yahoo said in September it’s taking a hit because car companies and financial services firms are spending less. That’s a big blow to Yahoo, because those companies deliver about 20 percent of its overall revenues. (Ouch – sounds like a business magazine.)
Compounding those problems with the present numbers are the future prospects.
When Google announced last week that it’s buying YouTube, the search giant effectively grabbed pole position in the video race. It also created a marketing bonanza, with everyone imagining all the sugary coolness GooTube will create. Yahoo is made to look like an also-ran before the real race even gets going.
That’s especially bad for Yahoo because it has promised ad technology innovation that it hasn’t yet delivered. But at least the company’s still growing. Some metrics from Nielsen//Netratings:
-Web traffic to the Yahoo! Parent company increased 7 percent in Q3 2006 vs. Q3 2005, growing from a 3-month average monthly unique audience of 100.0 million to 106.7 million.
-According to AdRelevance, Yahoo’s market share of estimated image-based advertising revenue was 30.8% in Q3 2006. From Q2 to Q3 2006, AdRelevance reports that Yahoo’s estimated revenue from image-based advertising grew 13 percent.
-Yahoo! Video was the fastest growing Yahoo! Channel from Q3 2005 to Q3 2006, followed by Yahoo! TV and Yahoo! Real Estate (see Table 1).
Table 1: Top 5 Fastest Growing Yahoo! Properties Year Over Year (U.S., Home and Work)*
+——————–+——–
–+———-+—————-—+
| Channel | Q3 2005 | Q3 2006 | Q3 2005 – Q3 2006 |
| | UA (000) | UA (000) | % Growth |
+——————–+——––+———-+—————-—+
| Yahoo! Video | 1,642 | 5,663 | 245% |
| Yahoo! TV | 5,729 | 7,882 | 38% |
| Yahoo! Real Estate | 1,113 | 1,446 | 30% |
| Yahoo! Toolbar | 4,337 | 5,417 | 25% |
| Yahooligans! | 1,998 | 2,433 | 22% |
+——————–+——––+———-+—————-—+
Source: Nielsen//NetRatings, October 2006
*Based on 3-month average monthly unique audience
