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Yahoo! goes up against Google's AdSense

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In a move that takes on Google's AdSense program, Yahoo! Search Marketing announced last week that it is extending the Yahoo! Publisher Network in the U.S. beyond large publishers to small- and midsize Web sites.

"Now we're working with publishers of all sizes," said Willan Johnson, general manager-VP of Yahoo! Publisher Network Online. "Everyone from a small blogger to a midsize online newspaper [can take advantage of the advertising platform]," he said.

Yahoo! CEO Terry Semel had hinted the company would soon unveil the expanded program in remarks he made last month during the company's second-quarter earnings conference call.

"We also plan to offer new contextual targeting capabilities, which should enhance our services both on Yahoo! and for small publishers throughout the Web," Semel said on the call.

Initially available in the U.S. through an invitation-only beta, the Yahoo! Publisher Network is a self-serve platform that enables small- and medium-size Web sites to automatically receive ads from Yahoo! that match content on their sites.

Large publishers that are currently part of the ad network include CNN.com, WSJ.com, Infospace, Viacom, NBC.com and MSN. Yahoo! would not disclose how many publishers it currently works with, but one analyst indicated it is fractional compared with Google's reach.

Much smaller than AdSense

"It's quite a bit smaller," said Gary Stein, senior analyst at Jupiter Research. "AdSense is enormous. Yahoo! has always been very slow about building their network."

A blog publisher who is one of the beta customers agreed. "While many other networks have tried to be a true competitor to Google, no one has come anywhere close to getting any kind of significant market share from those publishers," wrote Jennifer Slegg, owner of JenSense.com, a contextual advertising blog, in a post on Aug. 2. Google's Adsense product is 2 years old and has always been available to all publishers regardless of size.

The first advertising product Yahoo! will offer through the beta is its Content Match contextual listings. Content Match enables publishers to place Yahoo!'s contextually relevant listings on their sites and receive a share of the revenue generated by them.

"This is about additional leads to advertisers," Johnson said, adding the network is the next logical step in Yahoo!'s effort to build publisher-focused products and services, which currently include GeoCities and Yahoo! Small Business.

The goal is to offer publishers "all of the content, tools and services they need to maximize the value of their site for themselves and for their users," Johnson said. These include Yahoo!'s RSS and blogging tools.

Customizable design

Publishers will be able to choose the appearance and placement of ads that fit their site design.

They will also be able to identify ad categories beyond those matched by the algorithm. In fact, Johnson said publishers are encouraged to suggest additional categories during the beta stage. They will also be able to block competitive ads.

Search industry feedback on Yahoo!'s announcement has been positive. Several bloggers feel the competition with Google will be good for all publishers and advertisers, and predictions are that MSN will be next to offer a competitive service.

Jupiter's Stein said two major differences between Google's Adsense and the Yahoo! Publisher Network beta are pricing and ad category choices. With Yahoo!, advertisers set their own price no matter where the ad appears, while with Google's program, "the price the advertiser pays for a particular click is based on a combination of how much they bid and the quality of the leads delivered from the site the ad appears on," Stein said.

"There's more control over the price you are going to pay [with Yahoo!'s product]," he said. "The publishers are also given a little more control over the nature of the ads that are going to be served. That's a powerful thing." M

Media Editor Sean Callahan contributed to this report.

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