Yet another major move away from search for former competitor Yahoo – the now primarily news portal with Search powered by former rival Microsoft, Yahoo just bought content mill Associated Content for a reported cool hundred million.
According to Beacon Equity:
The purchase of AC, the freelance-writers Web site that resells content on a wide variety of subjects, is part of Yahoo CEO Carol Bartz’s strategy to expand its content offering to match similar steps taken by AOL’s Seed and Demand Media.
The Bartz plan includes increasing ad revenue at Yahoo from additional content produced through AC.
AC founder Luke Beatty commented, saying,
“We see it not so much as AC’s content being on Yahoo, but as Yahoo now having this massive group of people that can provide content on any given subject.”
AC claims to have 380,000 contributors for articles and snap shots and boasts that 50,000 pieces of content are reviewed each month. Customers include Cox Newspapers, Thomson Reuters and Gannett Company.
Henry Blodget, CEO of Business Insider, notes that Yahoo is sitting pretty right now, and it was time for expansion in some form to take place. Apparently, AC is that expansion. He says:
“Yahoo needs growth, not cash, so this is a smart use of [approximately] $100 million. It’s also a business Yahoo (mostly) understands, so the company will be less likely to screw the integration up.”
Yahoo’s Media VP James Pitaro defended the move to those who felt Yahoo should concentrate more on its strengths – a wildly popular homepage and strong sub-pages – saying it was a timely act with great potential, allowing them to offer content specifically to niche audiences:
“..which is by the way something we’ve done historically but really will be able to scale now….This is about extending our content offerings so that we’re relevant to both a mass and a niche audience. It’s the next phase for our content business.”
AOL was briefly interested in AC 2 years ago, when the price tag was set at $150 million. However, Time Warner shot down chief exec Tim Armstrong’s attempts to bring his prize investment aboard, and AOL has since started their own content supply mill, SEED.
Demand Studios is another SEO based content mill where providers churn out mostly ‘How To’ articles for $15 a pop – many contributors are becoming disgusted with content mills, however, as requirements increase and pay doesn’t keep pace.
Tags: AC, content mills, Demand Studios, SEED, SEO, Yahoo