Did Yahoo acquire online contest site Bix.com because it is “struggling” in social media? New York Times reports suggest so, but Yahoo CEO Terry Semel undoubtedly disagrees.
Semel proudly declared in his Q3 conference call that “Yahoo has been a pioneer in social media, ” as I reported in “Semel on Yahoo: We lead in social media”:
It is a long-term focus of ours, and we are a far bigger player in this space than many people actually realize. We had the foresight to buy Flickr back in the early part of 2005 and since then, Flickr has grown to some 20 million users per month, with a lot more to come.
Yahoo Answers, which we developed internally, is alone as a standalone, one of the largest communities and social media on the web. Answers surpassed 60 million unique users -- monthly users -- and 120 million answers worldwide just 10 months after it launched, and is now available in 18 countries and nine languages.
Together, Yahoo Answers, del.icio.us, Flickr, and Yahoo! Video have a total of almost 100 million users, which makes us the leading force in social media today. Importantly, and boy have I read about this, within this group is the largest community of the prized 15- to 24-year old youth demographic on the web, which stands at Yahoo at approximately 30 million.
We are incredibly focused on making every part of Yahoo a more social experience. We are convinced that the social media space will continue to grow and evolve and we plan to be a key player in this business.”
For Semel, then, Yahoo’s acquisition of Bix.com further enhances its already leading position in social media; He would most likely characterize the investment as an offensive move, rather than a defensive moved as the NYT portrays it:
The deal is an attempt by Yahoo to bolster its offerings in social media, an area where it has struggled to compete with sites like MySpace and YouTube.
Is Yahoo really “struggling” vis a vis MySpace and YouTube?
In the eyes of Rupert Murdoch’s News Corp., Yahoo is the company for MySpace to beat, as I underscored earlier today in “$6 billion MySpace: Will this Levinsohn cash in?”:
With continued international expansion, MySpace could well become the biggest global online company as early as this time next year. We are close to Yahoo in unique visitors in the U.S. already after one year, Let's see how we do around the world.
How about YouTube? Semel also outlined an agressive Yahoo video strategy in the Q3 call:
We are an early competitor in video, and we expect to be a very large player. Our goal is to make video as ubiquitous as text throughout the Yahoo network. In order to accomplish this, we are executing on a number of priorities:
- We have built one of the leading video technology infrastructures, which enables us to deliver higher performance and better quality video throughout Yahoo;
- We focused on establishing high quality user-generated content. To that end, we recently announced the acquisition of Jumpcut, which has a suite of online video editing capabilities. The integration of these tools will make Yahoo! an even better place for people to create, share, and discover great video online;
- We are moving quickly to forge partnerships with video producers. We have done more than a dozen to date, including the local news partnership we announced yesterday with CBS News, as well as the recently announced innovative partnership with Current TV;
- We are producing our own contextual relevant video within our leading verticals, such as sports, news, and now entertainment; finally
- With our superior ability to target audiences and advertisers, we are well-positioned to monetize video as its importance to advertisers grows.
It is early. We are off to a good start with one of the largest video audiences of more than 40 million unique monthly viewers, and we are going to continue to make this a key focus area over the long haul.
Semel’s five-prong, detailed and substantiated video development plan to grow an existing 40 million strong audience does not reflect a “struggle.”
Prior to Semel’s Q3 call, I projected that Yahoo would be moving to affirm its “rightful” leadership in the social media space, as I put forth in “Yahoo vs. MySpace, Facebook, Digg, YouTube”.
Yahoo’s acquisition of Bix.com is but the company’s latest social media move, as Bradley Horowitz, Yahoo VP of Product Strategy, states:
So how does Bix fit into Yahoo!’s strategy? Bix, which was founded in January, is a young startup — not unlike Flickr, del.icio.us, Upcoming.org, and Jumpcut when we acquired them. All represented emerging social media trends with great potential. Imagine where Bix’s creativity could go once we scale it to over half a billion people worldwide. For example, we’re currently looking into possible synergies with things like Yahoo Groups, Yahoo Messenger, Yahoo Video and our entertainment properties.