Microsoft Bid 'Galvanizing' Yahoo

Yang, Decker Outline Platform Strategy at IAB Annual Meeting

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PHOENIX ( -- In Jerry Yang's lemons-into-lemonade scenario, Microsoft's unsolicited bid for his company has fired up the ranks.
Yahoo co-founder and CEO Jerry Yang and Yahoo President Sue Decker
Yahoo co-founder and CEO Jerry Yang and Yahoo President Sue Decker

The Yahoo co-founder and CEO told 400 attendees at the Interactive Advertising Bureau's annual conference that Microsoft's unsolicited bid for Yahoo "in many ways has been a galvanizing event for all of us at Yahoo." The company is more focused than ever on creating a more open, efficient ad platform, Mr. Yang and Yahoo President Sue Decker told an IAB audience.

Mr. Yang and Yahoo's board have publicly rejected Microsoft's bid, saying it undervalued Yahoo's assets. Mr. Yang added that the board is "strong and independent" and has been spending a lot of time looking at options.

"I think Yahoo is a very unique asset," he said. "I'm a little biased. But it's something we need to think through carefully." He added: "I'm glad to be in Phoenix and not stuck in the office in a conference room."

'Opening up Yahoo'
He and Ms. Decker outlined Yahoo's platform strategy.

"Imagine that soon we'll be opening up Yahoo" to third-party developers, he said. The idea is for "third parties to be able to use our tools as easily as we use them ourselves." Such a strategy has been credited with Facebook's massive growth in 2007 and the growth of some Google properties, such as maps. Yahoo also will be "tapping the social phenomenon," Mr. Yang said, adding that it's early to understand exactly what that social graph means and how it can be implemented at Yahoo, but the company is starting to focus on it.

Internally, Yahoo has been developing an advertiser-publisher exchange, called "Apex," which Ms. Decker said will come out in "multiple releases over many years," with a few of the first releases coming in the second half of 2008, with Yahoo's newspaper consortium.

While the two were spare on details about the platform, Apex appears to be an interesting proposition in theory. For publishers, it's similar to Yahoo's newspaper consortium, in which Yahoo can sell across newspaper sites and newspapers can sell Yahoo's inventory.

"Publishers have unbelievable inventory that they're selling directly," Ms. Decker said. "But they're running out of inventory. ... Imagine if they could not only sell their inventory but Yahoo's similar audience inventory or other publishers' inventory."

For marketers, she said, the system takes the complexity out of ad serving and reporting. "Existing systems are not designed around today's objective of reaching audiences anywhere they are on the web," she said.
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