4C - leaderboard - 4-25-18
  • Yahoo’s Muddled Video Strategy Contributed to Its Decline

    Yahoo missed many opportunities over the years, leading to its acquisition today by Verizon, but surely one of the biggest was never creating a distinct identity in video. Back in April, 2014, I highlighted the murkiness of Yahoo’s video strategy, which has only continued to get more confusing since. With major video players like YouTube, Netflix, Facebook, Hulu and others pursuing distinct strategies that deliver specific benefits to users, Yahoo’s “everything but the kitchen sink” approach to video meant it never became truly competitive in any one area.

    Yahoo’s video initiatives seemed to be guided more by chasing others than by innovating with fresh ideas to get out in front. Examples include:

    • Its pursuit of long-form programming emulated Netflix and included picking up “Community,” which ultimately led to a $42 million write down in October, 2015.
    • Its pursuit of YouTube led to a failed effort to acquire Dailymotion and attempts to attract YouTube stars. Its streaming of NHL games and a single NFL game from London positioned the company as a sub-scale sports cable network.
    • Its concert streaming program with Live Nation brought great content, but never made it a competitor to Spotify, Pandora and others.
    • Finally, its signing of marquee talent like Katie Couric and David Pogue gave Yahoo a veneer of premium original programming, but not the depth to be a tune-in destination.


    Still, by virtue of Yahoo’s massive size, the company was a perennial top 10 video property according to comScore, racking up over 58 million unique viewers in February, 2016. The company also released an innovative new Yahoo Screen app in September, 2013, but unfortunately it was killed off 2 1/2 years later after the demise of “Community.” And it became a big player in programmatic video advertising via its November, 2014 acquisition of BrightRoll.

    To be fair, given Yahoo’s succession of CEOs and more recently its battles with large investors, Yahoo’s ability to define a long-term video strategy and then nurture it over time was limited. Yahoo has been under the gun to deliver short-term financial results for years, hardly the climate to make patient investments in video.

    Yahoo could have built a powerful video business, but it was surpassed by companies that got a much later start and were highly focused on their particular niche. The Internet is brutally competitive and Yahoo’s failure to become a video leader once again shows that cohesive strategy and great execution are essential to success.

     

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