The Internet, he told New Yorker media writer Ken Auletta at a breakfast series sponsored by the Newhouse School and The New Yorker, benefits from having two sources: search and branded. The Internet also, he noted, has the advantage of built-in accountability and return on investment.
"Did you ever hear of a single person who saw that auto ad on TV, stood up, put on his coat and went to the dealer and said, 'I want to buy that car I saw on TV'?" he asked. Additionally, he said, TV at this point doesn't offer any real way to know who's actually watching those ads. He called the new-media company a "media-exchange company" and said 20th-century media companies had great content and distribution but 21st-century media companies have great content -- licensed or aggregated --as well global distribution and technology, which is really the distinguishing factor.
He recalled Apple CEO Steve Jobs asking him how Yahoo could have the largest music product on the Web. Yahoo has the same content others do -- mostly audio files and music videos -- but adds personalization tools, ratings reviews and the ability to e-mail playlists to friends. "Technology enables us to make it a richer, more personalized experience."
While Microsoft buying a piece of Yahoo would be "quite possible," he said, it wasn't likely and the conversation "never came up." Talks of a collaboration instead focused on search -- "Can we be partners win search, can we own some of your search?" Mr. Semel recalled Microsoft asking. "That would be like buying our right arm and not our left."
Mr. Semel didn't have optimistic advice for Microsoft's new search platform, which it is launching after shedding Yahoo, which had provided its search marketing. "You have no chance," he said of Microsoft. "You begin with no data and not a single advertiser in your system." He said Yahoo had not yet joined Google in bringing an antitrust case against Microsoft's decision to make MSN search the standard in the coming version of Internet Explorer 7, but said his company favors open access.
Mr. Semel spent a long time addressing Mr. Auletta's final question about the role Yahoo played in helping the Chinese government identify and prosecute dissidents. He said the situation was "terrible" but that there's not a lot Yahoo can do about it on its own. He appealed to the other media organizations, including Time Inc. -- Time Managing Editor Jim Kelly and former Time Inc. Editor in Chief Norman Pearlstine were both present -- to keep reporting from China and said Yahoo appealed to the White House to put the issue on the agenda for President Hu's recent visit.
"Governments change governments," he said.