7 Network Has No Place in Technology Play: New Yahoo!7 CEO

With the backdrop of a Microsoft takeover offer for Yahoo!, the newly appointed CEO for Yahoo!7, Rohan Lund, declared that Yahoo!7 would be emphasising technology, not content. That’s music to the boffins in Redmond.

The interview with Neil Shoebridge of the Australian Financial Review centred on Yahoo!7’s new strategic tact away from content and towards its “core qualities” of email and search! Remarkably, Lund states that content is a commodity (tell that to his peers at 7), and that Yahoo!7’s best bet (at a local level) is to tackle Hotmail and Google concurrently.

As deck chairs continue to shuffle at Yahoo!7, the new CEO seems determined to steer a new course by emphasising the Yahoo! brand, and allow the 7 in Yahoo!7 to take a backseat. All this at a time when the 7 half of the JV seems to be kicking major goals in free-to-air. Not only that, but with media assets like 7 and Pacific Magazines at his disposal, Lund is ready to turn his back on all it (”Reproducing TV shows and magazines online is not a game we are ever going to win.”)!!!

This reemphasis on search by the local online publisher has major implications for its advertising fortunes. The risk is that by taking the fight up to Google, Yahoo!7 will shift attention away from the needs of display advertisers. Failure to take significant market share away from Google (which is highly likely - a 99.99% probability) will leave Yahoo!7 with an even more precarious hold on advertising budgets than what it currently enjoys.

Just because Yahoo!7 has failed in the past to produce or secure blockbuster content, does not make the proposition that ‘content is a commodity’ correct. This is highly contentious and seriously flawed. In 12 months there might not be a Yahoo!7 to worry about should the Microsoft offer win Yahoo approval.