Can Yahoo do content?

The Web portal's plan to become a major Internet content player is treading water, despite its Hollywood credentials.

Early in Lloyd Braun's tenure at the helm of Yahoo's media group, he ran a quirky idea past his colleagues: a plan to add pizzazz to the company's Internet news site by creating a show anchored by animated puppets.

Braun discussed the puppets and other new ideas in hallway talks with executives from Yahoo's media team, according to people familiar with the conversations. Despite Braun's enthusiasm, however, the puppets were politely ignored.

After nearly 15 months on the job at Yahoo, there have been more awkward moments like the puppet-news pitch than success stories for Yahoo's media group and Braun, a marquee Hollywood executive who's supposed to be turning the Internet search heavyweight into an entertainment industry player.


Though the 47-year-old executive may be a star in Hollywood circles--as chairman of ABC Television Entertainment he's credited with green-lighting hit shows like "Lost" and "Desperate Housewives"--critics say he hasn't figured out how to adapt his Hollywood know-how to the digital world.

As a result, Yahoo's plan to become a major Internet content player is treading water. Yahoo Media has lost ground to rivals in key areas and has yet to goose advertising sales with a runaway content hit, which many expected Braun to deliver when he arrived with fanfare in November, 2004.

Growth at the Web sites in Yahoo's media corral has been mixed, according to figures from ComScore Media Metrix, a New York-based research firm. Yahoo Finance and Yahoo Games, for example, both lost readership last year. In fact, Microsoft's MSN Money site now brings in more unique visitors than Yahoo Finance, though Yahoo Finance still leads on total page views.

"Yahoo's in a good position. But it still has a question about content," said a source familiar with Yahoo's media ambitions who asked to remain anonymous.

With such a mixed record so far, Braun's future with Yahoo has become grist for the rumor mill in Hollywood and Silicon Valley. While some claim Braun is on his way out, others say he still has time to find the crossover between the entertainment and technology industries to prove wrong his naysayers.


Braun's struggles also raise larger questions about Internet media. Can a giant Internet portal like Yahoo or Google also create original content that people want to read or watch? Or are the portals destined to be like cable television carriers: Powerful content aggregators who dabble in their own stuff but are ultimately best at providing a platform for other people's material?

Yahoo spokeswoman Nissa Anklesaria said the company doesn't comment on the development process or on rumors about executives. Braun was not available for an interview for this article, she said.

"Lloyd has assembled a terrific team of senior leaders, and under his direction, Yahoo's media group has seen great success this year....We're in the early stages of this opportunity, and we're excited about the next year for this business," Anklesaria said.

The content future
For more than a decade, Yahoo has been an Internet search engine and portal that aggregates other companies' content. The aggregation strategy has by most accounts worked, particularly in recent years. Yahoo's revenue has jumped from $953.1 million in 2002--the first full year CEO Terry Semel ran the company--to $5.26 billion in 2005.

But Braun's job is about positioning the Sunnyvale, Calif., company for the future, when analysts expect a significant portion of traditional television advertising budgets will move to digital media. Yahoo, like every other big Net company, wants a slice of that pie.

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