Interview with Mitch Lazar
VP Business Development

Yahoo is one of the biggest players in the online world, and arguably the most mobile focused of all the internet giants. We had a chance to interview Mitch Lazar, Vice President of Business Development at Yahoo to get an insight into how Yahoo views mobile advertising, and what plans they have in store.

Sure. There are 4 main areas that we are focused on in the mobile space, and all of them relate in one way or another to mobile advertising. Our four key focus areas are:
• mobile search,
• mobile applications,
• personal messaging,
• and of course our mobile ad selling and serving business.

Why don’t you take us through each of these one at a time. Let’s start with mobile search.

We’ve been focusing a large amount of our time at Yahoo to reinvent search on mobile, because we believe its broken. We’ve recently rolled out our new product called oneSearch, which is about instant answers for people looking for results on the mobile web. Instead of links, you get the actual results information, which is more intuitive.

We think that a better, more intuitive experience will help drive engagement, which will equal more eyeballs and frequency of users, and will help sell advertising. Getting this right is absolutely core to what we are doing.

(See the example at the left. In response to a search request on the word “Pizza”, oneSearch came back with a wikipedia definition, some flickr photos, some addresses for pizza restaurants near where I live, and some suggestions for possible additional searches. Note that the actual information is given, not just links to information as is typically the search response.)

Another focus you mentioned is mobile applications. What is Yahoo doing in this area?

Our view was that no single application had been able to bring together and provide a consolidated user experience on mobile – an experience that would include search, plus news, sports and general information, plus being integrated with your contact information, etc. So we developed and released Yahoo Go for mobile over a year ago, and then more recently a java version.

It is designed with a “carousel” type interface, with individual widgets that provide immediate access to a variety of services such as Yahoo Local and Maps, news, sports, finance, entertainment, weather, Flickr, Yahoo Mail, and RSS feeds. You don’t have to go to different places on the web to get your information, it brings the mobile web to you. And you can actually personalize it, which is a huge step.

(for a review of Yahoo Go for Mobile, see this ZDNET article from May 2007)

Do you serve advertising on Go?

Yes, of course we have built advertising capabilities into Go. The core business proposition is about the graphical advertising within the application itself, as well as the pay-for-performance advertising associated with oneSearch.

One early criticism of Yahoo Go for Mobile was that it only ran on Nokia Series 60 phones. Has this changed?
Go now runs on lots of phones, and in fact it is pre-installed on selected phones from Nokia, Motorola, LG, Samsung, and HTC. You can also download it from m.yahoo.com, and of course it is free. So the distribution is definitely growing.

You also mentioned ‘mobile messaging’ is a focus area for Yahoo. Tell us about that.
In this area we are working with operators and others in the industry to try to bring a better messaging experience to users. We are actually at an early stage with this one, but we are exploring it because we think messaging is such an important piece, and we need to help bring things together in a much more intuitive way.

It’s early, but we have seen some very interesting ideas around how you can deliver advertising within messaging, and again, this could help create the business eco-system that is necessary to be successful.

So let’s talk about Yahoo’s mobile ad selling and serving business.
We believe that Yahoo is absolutely perfectly positioned to be a leader in the mobile advertising space because we have done that so well on the web. We already have the relationships with the advertisers and the agencies – we are doing it every single day for our online business – so moving to mobile we think is a natural extension.

Also, we have a great ad serving platform with extensive yield management capabilities that we have been using very successfully online (for example we serve all the online eBay ads) and we have migrated this platform to the mobile world.

This is why think we will be successful – we have the tools, the infrastructure, the technology on one hand, and on the other hand we have the relationships with the advertisers. This lets us bring together an eco-system that will make mobile advertising successful.

Most of what we’ve discussed so far relates to operator ad inventory. What about ads for off-deck content?
We have already announced a partnership with MobiTV for their advertising. It is an important space for Yahoo, so we will continue to look for ways to work with partners to sell and serve advertising for off deck content. If you are going to be full service for advertisers, you have to be able to address both ends of the market. You will see more from us in this area.

From your perspective, are there any factors that you think are holding back the uptake of mobile advertising?
Really I see three things.

First is the cost of data transport. Once it’s truly flat rate and the consumers really don’t have to worry about the cost of data, they will start using their phones in a different way. This is slowing the overall growth the mobile internet.

The second big challenge is the huge number of different handsets that have to be taken into account. It isn’t only mobile advertisements that have to be modified for different phone capabilities, but games and other content as well. It’s hard to get true economy of scale in this environment.

Finally, there is a big need to work with the advertising industry in general to get them educated and excited that this is the place to be, this is the place to buy, this is what you’ll get.

One last question for you Mitch. Do you care to make any predictions as to what we will see in the next few months?

For the industry in general, I think you are going to see a lot more advertisers getting more comfortable with the medium itself – they will become much more savvy. You will see the industry becoming warmer towards mobile advertising.

As for Yahoo, I can tell you over the next 12 months you can expect to see Yahoo announcing a lot more partners in the mobile advertising space. That’s definitely what you’ll see.

Thank you Mitch.