Yahoo, Al Gore in video team-up
Current TV, the cable channel co-founded by the former vice president, announces a partnership for an online video site.
NEW YORK (CNNMoney.com) -- OK. So Al Gore didn't really invent the Internet. But thanks to a partnership with Yahoo, the former vice president is about to become a bigger media player on the Web.
Internet leader Yahoo announced a joint venture Wednesday with Current TV, the cable network co-founded by Gore. The two companies are launching the Yahoo! Current Network, an online video site featuring user-generated content as well as professional videos from the staffs of the two companies.
The Current TV cable channel, which features short news stories geared toward a younger audience, was launched last year and is now available in about 30 million homes. Like the new site with Yahoo (Charts), Current TV also features videos submitted by users.
But Joel Hyatt, the CEO of Current Media and a co-founder, said that the videos for Yahoo Current will be original videos created just for the site.
"The innovation is not taking what we're doing on TV and porting it over to the Web. We don't particularly see that as a unique idea," said Hyatt. "This is not about repurposing content from TV for the Web."
Current TV's decision to partner with Yahoo is interesting since the cable network already has a partnership with Yahoo's biggest rival, Google (Charts). The search engine leader provides updates on the cable network every half hour about popular searches on the Web. Google also has an online video site.
Hyatt said that the decision to partner with Yahoo was based on the fact that Yahoo is taking more steps to be an online media firm as opposed to just a search firm. And that fit with what Current TV would like to do online.
Hyatt stressed that there was no rift with Google. "Wouldn't you want to work with both Google and Yahoo? We're delighted with the relationship with both companies," he said.
For Yahoo, the Current TV joint venture is the latest effort by the company to bulk up in the world of online video, specifically when it comes to user-generated content.
Last week, Yahoo also announced a partnership with PepsiCo (Charts), the maker of the Doritos brand of snack food - people interested in creating a Super Bowl ad for Doritos can go to Yahoo's video site to upload their commercial.
In addition to Google, Yahoo faces challenges from privately held YouTube, the most popular online video site, as well as MySpace, the social networking site owned by News Corp (Charts). Microsoft (Charts) unveiled plans for its own user-generated video site, Soapbox, on Tuesday.
According to data from Web research firm Hitwise, Yahoo's video site had about a 6 percent share of the market, ranking it fourth behind YouTube, MySpace and Google.
The business model for online video is still unproven however. Many of the videos on YouTube and MySpace are quirky short videos that may not attract the interest of advertisers.
But Jason Zajac, vice president and general manager of social media for Yahoo, said that the Yahoo Current site hopes to generate revenue through online video ads from large corporations thanks to its mix of user videos and professional videos.
"This is the best of both worlds. We have user created videos but also ones with an editorial filter," he said. Zajac added that in addition to the dedicated site for Yahoo Current, Web users will often see videos from the network promoted on Yahoo's home page and other Yahoo properties, such as photo sharing site Flickr.
Yahoo Current will have four distinct channels, one that focuses on buzzworthy news and events, another on so-called action sports news, another on travel and finally, one on automotive news.
That last channel is worth noting since Yahoo chief financial officer Sue Decker warned Tuesday at a media conference in New York that the company's sales for the third quarter would come in at the lower end of expectations. And Decker specifically cited softness in auto advertising as a reason for the weakness.
Shares of Yahoo plunged more than 11 percent in heavy trading on the Nasdaq Tuesday as a result.
Zajac would not specifically comment about Decker's remarks. But he did say that car manufacturers were showing interest in the auto channel on Yahoo Current, especially since the expected audience for the site should consist of younger viewers that tend to be more attractive to advertisers.
"Interestingly enough, because this content is extremely unique and highly relevant for auto advertisers, I don't think we'd be surprised to see auto players take advantage of Yahoo Current. It's an optimal way for them to advertise online," he said.