Making friends in obscure places
Yahoo is hot on distribution deals to inject its software onto the desktop. That way, the Internet media company can broaden its staggering reach of 325 million users worldwide while gaining unparalleled visibility into consumer behavior on the PC for marketing purposes. At least that's my guess.
I'm sure Yahoo doesn't have immediate plans to sell and display behavioral advertising on the PC--consumers are just not ready for that privacy invasion. But I believe Yahoo, Google and many others are likely preparing for the day when people are willing to accept ads on the PC for some kind of superior computing experience. And when they are, Yahoo and Google will be prepared to expand their money-rich search-advertising franchises.
(Google is also regularly rolling out desktop applications and inking partnerships in the PC domain.)
Yahoo's latest distribution deal is with Phoenix Technologies, a Milpitas, Calif.-based company that develops and packages the underlying tools and applications for the PC and now, other digital devices.
Under the deal, Phoenix will distribute Yahoo's start page and Web search toolbar to OEM (original equipment manufacturer) partners, to which it ships more than 100 million "units" or software packages a year. Wow. Yahoo and Phoenix called the deal "the first of several that could revolutionize the relationship between the portal and the OEMs and system builders."
Via the distribution chain, OEMs and system builders such as ECS and Systemax will likely share in profits from Yahoo's search advertising from the toolbar and home page.
The deal builds on Yahoo's recent tie-in with Adobe Systems, which was a coup for Yahoo. Under that agreement, Adobe will combine its PDF format with Yahoo's Internet services. The companies will create an online service to convert Web content into PDF (Portable Document Format) files and a toolbar that would add access to Yahoo Search and other features to Adobe Reader, the company's free PDF client.
Yahoo could be making friends in the right places.
