As Yahoo Focuses More On Ad Services, The Portal Remains Central

Jerry Yang’s promise of a significant company overhaul within his first 100 days after becoming Yahoo (NSDQ: YHOO) CEO has been the subject of constant scrutiny from the moment he uttered it back in July. As we mentioned last week, Yang has started to downplay the importance of time-frames. He was wrong for marking time that way, not because it was arbitrary, but because, as Adweek points out, the overhaul began hundreds of days before Yang made his statement.

During Terry Semel’s tenure, Yahoo began to expand beyond operating a web portal to becoming part of an online ad network. Three years ago, Semel held up Yahoo’s value as a portal — it would attract revenue by attracting traffic. But when it became clear that alone wouldn’t be enough, Yahoo began looking to advertising beyond the site: one example: its initial investment in online ad exchange Right Media late last year (it ultimately bought it completely for $650 million in April). Yahoo cemented its commitment to pursuing the ad model earlier this month with the $300 million purchase of behavioral ad network Blue Lithium.

But Yahoo doesn’t have to cast off its portal-centric qualities that Semel thought made the company so valuable. The portal is still key, Todd Teresi, SVP of display marketplaces at Yahoo, tells Adweek. Operating a portal allows Yahoo to obtain and store behavioral data about consumers, which can ultimately be used to target them as they visit other sites. For example, a visitor to Yahoo’s hybrid cars’ section, later on can be targeted with a hybrid car ad on MySpace. Teresi: “Without that ability to target people, delivering relevant ads isn’t possible.”

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