The joint venture with Seven Network will let Yahoo! create cross-media packages for advertisers.
Yahoo has bolstered its presence in Australia and New Zealand through a joint venture with regional media giant Seven Network Ltd. The deal will create an entity that will let advertisers buy packages of on- and offline media.
Seven and Yahoo will form a new 50-50 holding company that will combine Yahoo Australia & NZ with Seven's online assets, television and magazine content. Seven and Yahoo will each hold three of the six board seats in the entity, which will be rebranded in January.
"Yahoo and Seven have very complementary businesses and brands, and we see this as a tremendous opportunity to build a leadership position in Australia," said Terry Semel, chairman and CEO of Yahoo, in a statement. "This is the best combination to benefit from increased broadband penetration, rich media consumption, and the growing cross-media advertising spend. Together, I believe we can deliver the most engaging and innovative rich media experience for Australian audiences and advertisers."
Yahoo Australia & NZ and Seven will be combining their online teams and are expected to launch a new name and online presence in late January, coinciding with Seven's coverage of the Australian Open and the Olympic Winter Games in Torino, as well as the opening weeks of the 2006 television season.
Yahoo plans to combine its global content, products and technology with Seven-owned content to create localized online media, entertainment, and ad opportunities online. Advertisers will be able to purchase combined offline and online sponsorships across Yahoo Australia & NZ, the Seven Network and Pacific Magazines.
Seven is the largest television company in Australia reaching 98 percent of Australians through its owned and operated stations and affiliate agreements. Seven's Pacific Magazines is the second-largest magazine company in Australia, with a 21 percent share of the market.
Seven will also contribute AUD$10 million to match the existing development capital in the business. It will also do offline promotion through the Seven Network and Pacific Magazines. Seven's 33 percent stake in mobile solutions provider m.Net Corporation Ltd. is also expected to be included.
"We are building on our strengths to create a broad media company focused on the delivery of relevant content to all Australians across a number of delivery platforms," said Kerry Stokes, executive chairman of Seven. "Yahoo is the global Internet leader and their focus on developing compelling content to engage with online audiences complements our strategy."
The Australian online advertising market was nearly a half billion dollars in FY04/05, surpassing cinema and outdoor advertising, and is expected to grow 21 percent year over year for the next five years, according to Price Waterhouse Coopers, which makes online the fastest growing advertising segment in the Australian media market.
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