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December 21, 2006

Publisher FeedBack on the Yahoo Publisher Network

posted by MR WAVETHEORY at 12/21/2006 08:33:00 PM
Attention Google Headhunters: The Yahoo Publisher Network Team

Yahoo! Inc. (Nasdaq YHOO) has been quietly testing Yahoo! Publisher Network, aka YPN, while Google (Nasdaq GOOG) AdSense has been making a big brouhaha about people making thousands of dollars per month or day using the service. Yahoo Publisher Network allows publishers to earn revenue from their websites like AdSense, when a user clicks on an ad. Publishers have both been complaining and also been raving about YPN.

Here's what publishers are saying about YPN.

1) Yahoo! Publisher Network has been suffering intermittent outages. According to Yahoo! itself, YPN was down on December 14, 2006.

Yahoo Publisher Babes: Yahooligans Busy having fun at PubCon2006 at the Palms. Yahoo had a scheduled outage during PubCon. No biggie.

Hi All,

YPN’s contextual ad product experienced a temporary outage yesterday. We identified the situation and had a resolution in place quickly. Ads are running properly but if you continue to see any problems, please reach out to a customer service rep.Thanks

YahooSarah

Yahoo did not give a reason for the outage, but I am hearing that YPN has also been down several times this week. Publishers are reportedly seeing "HTTP 1.1/Unavailable" errors where YPN ads were supposed to show up. I wonder if this is a scaleability issue. Too much traffic? Growing too fast? The product is in beta, so you can't blame them. Then again, Yahoo! didn't report the outage, so I think they could do a better job with owning up to the outage. After all, why not come clean? The product's in beta anyway. That would be good news!

Yahoo Babes from PubCon 2006: Yahoo! delivers delicious results.

2) Some Yahoo! Publishers Are Getting Great RPC/EPC, but poor CTR. Some YPN publishers are saying that the revenue per click and earnings per click they get from Yahoo! is 3x or more than what they get from Google AdSense. Why? Yahoo has implemented a minimum bid of $.10 or higher on keywords, whereas Google AdSense can pay as little as $.01 per click. This could explain the big differential. The explanation for the poor CTR could be poor targeting. My sense is that Yahoo! does not crawl publisher pages as frequently as Google AdSense. As a result, ads are not targeted to the page level. Also, because YPN is in beta, that means the number of advertisers using the product could be alot lower, meaning there are fewer targeted advertisers using the system.

3) Fast growing publishers are seeing incrementally lower CPM rates. A few publishers are complaining that even though their traffic has increased on their site, their revenues have not followed in footstep. A publisher I know grew traffic by 10x over the last year and only saw a 2x increase in revenue. I have no good explanation for this. Impressions and revenue should grow in lockstep.

One reason I can think of is an imbalance between publisher supply of ad inventory vs advertiser demand: Yahoo Publisher Network may not be growing the advertiser base as fast as the supply of publishers coming online. I would buy this explanation, because it is simple to understand. Without sufficent numbers of advertisers bidding for Content Match keywords and rapidly growing network of publishers, advertisers could be quickly depleted of ad dollars and hence publishers would see lower incremental CPMs.

YPN: Taking Away the Cupcakes Before the Party Has Started?

Another reason: Yahoo! may be making revenue share adjustments in the background. Initially, the revenue share may have been high to compete with AdSense and woo advertisers. Then, maybe the revenue share has been lowered. If rev share goes from 80% to 70% to 60% to 50% to ... x% then you can have wild fluctuations in revenue. I doubt this is happening, because it seems too early. YPN has not launched yet, and cutting the revenue share early would make the product less competitive with Google AdSense which has a very well established base.

Many of these pieces of feedback came from established YPN publishers who are more knowledgeable about the program than I am. I hope YPN keeps improving itself. Good luck!

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