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"Yahoo!" things are looking up: CEO

Ad revenues and subscriptions to soar...
Written by Jim Hu, Contributor

Ad revenues and subscriptions to soar...

Yahoo! CEO Terry Semel has painted a rosy picture of the web portal's future for investors, saying marketing revenue and paid subscriber numbers will rise significantly next year. The online giant's marketing services revenue - comprising online advertising, sponsored search results from its deal with Overture, and other promotions - will grow more than 20 per cent in 2003, according to Semel speaking at the Credit Suisse First Boston Media Week Conference in New York. Semel said Yahoo! expects subscriptions to its premium services will exceed two million by the end of the year, meeting targets it set in October. Yahoo!'s premium services include email forwarding, personals, extra storage and digital subscriber line (DSL) access with SBC Communications. "We are stronger and smarter and more well-prepared to meet the challenges ahead," he told investors. Yahoo! has seen its fair share of hard times caused by the dot-com bust. The company's total revenue dropped from $1.1bn in 2000 to $717.4m in 2001. For this year, Yahoo! expects revenue to reach between $930m and $955m. Key to Yahoo!'s turnaround plan is revenue diversification, which largely centres on moves to increase its number of paying subscribers. The centrepiece of this plan is its effort to partner with broadband access providers. Under one deal in the US with SBC, Yahoo! gives the company's DSL subscribers access to a smattering of paid services and a souped-up version of its web page. In return, SBC gives Yahoo! a cut from each monthly bill. Yahoo! also gets a cut from existing SBC DSL subscribers who switch to the co-branded service. SBC has about two million DSL subscribers, Decker said. Yahoo! has not announced a broadband deal since the announcement of the SBC partnership in fall 2001. However, Semel said he expects cable and DSL companies will want to strike nonexclusive deals with all the web giants, including Yahoo!, in the coming year. However, key partners such as Verizon have reached out only to MSN so far, but when asked whether Yahoo! will one day partner with Verizon, Semel replied with a curt "yes". Jim Hu writes for News.com
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