Yahoo has smartly launched a Spanish Language version of its mobile homepage. The company cites Census data that reflect a population of 46 million Hispanic people in the US. Yahoo also cited comScore data that show tremendous mobile internet growth among Hispanics, which is “outpacing that of all other groups, with 88% of Hispanics consuming content on their mobile phones.”

Here’s the new Spanish language mobile homepage, which mirrors the look and feel of the English-language version:

Here’s the PC version; note the tile ad en Espanol:

The ad below from the Spanish mobile site is in English but in short order we can probably expect Spanish-language ads, which is one of the big opportunities here that Yahoo is pursuing:

A report analyzing traffic and click-through rates from ad network Chikita finds that “Bing users are over 50% more likely to click an ad on your site than Google users.” What this means, according to the post, is those who arrive at third party sites via Bing click more frequently on ads on those sites than those coming through Google. TechCrunch offers a bit more detail and speculation about why this might be (i.e., “the law of large numbers”). According to Chikita, the respective click rates are:

• Google: .97 percent
• Yahoo: 1.24 percent
• Bing: 1.5 percent

Bing appears has made some incremental gains in search market share since its launch at the end of May. The two most recent roundups of the numbers are here and here. Even though Bing has been well received and has some momentum it doesn’t appear that will quickly translate into significant market share advances. For that reason Microsoft still needs Yahoo’s reach.

Turning to the seemingly perpetual subject of a search deal between Microsoft and Yahoo, AdAge is reporting that a deal, previously described as “imminent,” could be announced this week. The article says the payment structure was a sticking point and will be a revenue share rather than an upfront payment and revenue guarantees, which Yahoo had reportedly wanted:

Execs in Redmond never conceived of the deal as an upfront purchase of Yahoo’s search traffic but as a deal in which Yahoo would be compensated from a share of revenue from the sale of search ads. Yahoo would be allowed to sell search ads on Bing.com as well as its own site, giving it more search inventory to sell and making it a bigger player in the search sales front. It would also immediately be able to save millions by not having to maintain its own search infrastructure.

The latest terms of the deal underscore Microsoft’s devotion to developing and owning technology vs. selling media. The deal won’t make it a bigger seller of online advertising but it would allow it to eliminate a search-technology competitor in Yahoo and consolidate roughly 30% of the search marketplace on its own platform — a large enough share, CEO Steve Ballmer seems to believe, to dent Google’s dominance.

If the article is correct then Yahoo would retain the ability to sell search and display to its advertisers, but probably not through an integrated platform. Currently Yahoo sells search via Panama and display advertising through APT; however there was always discussion of integrating the platforms in the near term.

We’ll have to wait to see whether there’s a deal and what the terms are. Any such deal would have to pass muster with regulators before it could be implemented.

On that front, the NY Times ran an article this weekend describing internal conflict within the Obama administration about how aggressive to get with anti-trust policy and prosecutions. The US Department of Justice anti-trust chief Christine Varney, who has described Google previously as “a monopoly,” is apparently facing push-back in her quest to reign in some US corporations. How this internal debate plays out will affect scrutiny of potential deals such as Yahoo-Microsoft.

Yesterday on the Yahoo Q2 earnings call, CEO Carol Bartz spent time talking about local and small business (SMB) advertising. She said that these overlapping segments were increasingly important to Yahoo and she announced a new deal with AT&T (to sell display ads on Yahoo to SMBs). She added that between AT&T’s yellow pages sales force and the company’s newspaper consortium partners Yahoo effectively had “13,000 sales reps” in local markets around the US.

Here’s the relevant verbatim Bartz quote from the earnings call transcript:

We also know that local relevance of both content and advertising is increasingly important to our users and capturing more of the local ad market is a big focus to us. To this end, we have announced today that we have expanded our relationship with AT&T to include the reselling of Yahoo! display ad inventory by AT&T’s advertising sales force. Grouped with our strategic newspaper consortium partnership we now have a local sales force 13,000 reps strong. These relationships extend our reach into the fast growing local online advertiser segment.

Given all that it was a surprise to me to see a report on peHUB asserting that Yahoo was seeking a buyer for both HotJobs and Yahoo Small Business:

Now, peHUB has learned from multiple sources that as part of Bartz’s drive to dismantle non-core assets, Yahoo is also trying to shed both HotJobs, which Yahoo acquired for $436 million in cash and stock back in 2001, and Yahoo Small Business, which helps customers get their small businesses online by providing them with everything from domain registration to site monitoring to promotional tools.

On the subject of small business, beyond the remarks above, Bartz also highlighted the Yahoo-Bank of America small business answers center:

[L]arge advertisers such as Bank of America come to us because of our leading sites and large reach. We are partnering with B of A to promote its small business answer center. The center is integrated with our popular social assets such as Yahoo! Answers and Yahoo! Group to capture user engagement. It is promoted across our network through related search and display ads.

Yahoo Small Business is one of the biggest — if not the biggest — webhosting entities in the SMB market. I don’t know its precise economics, but it generates fees revenue and also serves as a marketing channel to the SMB marketplace:

In addition, Yahoo recently launched a partnership with AdReady that allows SMBs to create self-service display ads that run on the Yahoo network. This doesn’t seem like a company ready to abandon its small business assets as “non-core.” Still it could be true.

I’ve always believed that Yahoo has not fully exploited Small Business as a channel and maybe they want to be out of the hosting and domain registration business. Perhaps the company feels that others are better suited to sell and create the ads that will simply run on the Yahoo network and through the APT platform.

I might be more inclined to believe that HotJobs is for sale. However HotJobs was the basis and cornerstone for the newspaper consortium that Yahoo regards as strategic. That consortium has now moved well beyond HotJobs, but recruitment remains one of three relatively large (though declining) classifieds categories for newspapers. It would certainly raise lots of eyebrows among consortium newspaper execs if the HotJobs property were sold.

Yahoo is trying to control expenses, shed groups and properties that are not strategic and invest where the most value is to be found. However, given Bartz’s remarks about the importance of local and small business advertising and its newspaper consortium, it’s very strange that Yahoo would be selling these two properties.

After an apparently successful limited trial, Yahoo is rolling out a program that targets small businesses (SMBs) for self-service display advertising on its network and through RightMedia, its ad exchange.

The DIY portal is a collaboration between Yahoo and AdReady, which supplies the back end and the ad templates. (Google earlier introduced a similar, though less elaborate product.) The templates can be sorted by best performing (CTRs are exposed), most used and newest. Advertisers can use their own ads as well. Ads can be targeted by geo, content category or Yahoo property. They show on the Yahoo network and third party sites via the RightMedia exchange.

There’s no word on integration with Panama. I would assume reporting will be combined or folded in at some point for those using both search and display.

Why do this? “Dynamic visuals get more clicks to grow your business” and “people spend 95 percent of time online browsing sites with display ads” says the flash demo. Yet online display advertising has been under intense pricing pressure because of excessive inventory and declining demand from the flight to search and other performance-based advertising during the recession. However a new comScore-OPA study, consistent with past research, tries to counter the negative perception of display advertising by showing that display drives lots of search and engagement.

According to the study, to be released on Thursday:

• About one in five consumers [who saw display ads] searched on the advertised brand
• About one-third visited the advertiser’s site in February
• Consumers exposed to the display advertising spent over 50% more time than the average visitors to these sites the next month
• This rise in time spent is matched by a similar increase in page views

There’s always been a challenge asking small businesses to do anything online that requires self service. However, that isn’t stopping a wide range of companies from trying to capture SMB ad dollars on the display side. On the new Yahoo MyDisplayAds, if advertisers intend to spend more than $2,500 per month, they’ll get more hand holding and support apparently.

I have some additional thoughts and discussion on my blog Screenwerk.

Here’s a change of pace: Some newspapers are making money online and crediting a search engine with making it happen. AdAge writes about the Yahoo-Newspaper consortium, and cites multiple cases where individual papers or newspaper groups are using Yahoo’s ad targeting technology to increase online-only ad sales.

The consortium has sold an estimated $50 million in Yahoo inventory so far, with about 150 papers using the platform and 350 more on the way. But what’s most impressive is some of the individual reports from happy newspaper people:

• Scripps newspapers report a 30% jump in online-only ad sales in the 1st quarter; “… our ability to sell behavioral targeting has really caught on with our advertisers and particularly with our sales forces,” Scripps says
• The Atlanta Journal-Constitution tripled inventory to cover 70% of the market, and can sell at higher rates because of Yahoo’s ad targeting
• Hearst Newspapers is also selling targeted ads at 15% premiums

This is the second positive report on the Yahoo-Newspaper consortium in recent months; we wrote about similar gains in early March.

As expected, Yahoo earnings were down, about 13 percent YoY. According to the earnings press release:

Yahoo! Inc. today reported revenues of $1,580 million for the quarter ended March 31, 2009, a decrease of 13 percent from the first quarter of 2008.  Excluding the impact of currency rate fluctuations, revenues for the first quarter of 2009 would have declined 8 percent from the first quarter of 2008.  The Company’s non-GAAP operating cash flow for the first quarter of 2009 of $409 million exceeded the midpoint of the outlook range provided by the Company last quarter.

Query volume was up and search share was “stable” but revenue per search was down, based on macro-economic conditions according to Yahoo CEO Carol Bartz

Bartz said that the company was restructuring, as previously rumored, to simplify and streamline operations, dividing the company into a North American operation led by Hilary Schneider and an international division to be led by a hire yet to be named. She confirmed the rumored 5 percent reduction in force but said these layoffs were not about “across the board cost cutting” but rather about streamlining the operation, eliminating redundancy and focusing on key strategic areas.

Among those products and services Bartz mentioned as strategic were the Yahoo homepage, news, finance, mail, sports and mobile. Bartz used some of her trademark “colorful” language in reference to how Yahoo would invest in key product areas to create “kick ass experiences for our users.”  She added that the company would “manically focus on our most important products.”

When asked during the Q&A session about a potential search deal with Microsoft she said that “search is critical” to Yahoo’s business and so was the capability to combine search and display advertising. She declined to comment on talks with Microsoft about a potential advertising deal.

Bartz touted the positive advertiser reaction to the search retargeting program (”freakin’ awesome”), which offers “search insights” to display advertising (behavioral targeting). She also spoke about how Yahoo was bringing “the best of display advertising to search . . . rich media rather than just blue links.”

A great many of the questions from the Wall Street Analysts  on the call focused on the future of online brand and premium display advertising. Rhetorically Bartz asked, “Does the trend toward performance marketing signal a secular shift away from premium brand advertising online?” She then added: “My answer is an emphatic no.” And Bartz predicted a return to higher brand-display advertising when the economy “returns to normal.”

Here are some of the numbers from the earnings call slides:

When the Yahoo-Newspaper consortium was announced in early 2007 both Yahoo and the newspaper industry were stronger and in better shape than they are today. (That’s certainly true for newspapers.) Since that time Yahoo has suffered through the MicroHoo episode, gone through a couple reorgs, laid off a meaningful chunk of its workforce and gained a new CEO. The newspapers, for their part are mired in a well-publicized crisis, with ad revenues falling precipitously and major publishers making dramatic newsroom cuts, some declaring bankruptcy and even shutting down publications entirely.

Now comes a bit of good news for both Yahoo and its newspaper partners; the consortium deal appears to be going well according to an update in the NY Times on Sunday. It’s being managed by Lem Lloyd and Hilary Schneider, both at Yahoo and both former Knight Ridder executives. Lloyd manages the initiative directly while Schneider has a larger role at Yahoo (as you know) and reports directly to Yahoo CEO Carol Bartz. She is now in charge of Yahoo’s new North American division.

The newspapers participating in the consortium program, which is most of the major publishers in the US, are using Yahoo’s new ad platform, APT, to do a range of different types of targeting on their own sites and boost CPM rates accordingly:

One is a new ad system from Yahoo, currently installed at about 100 newspapers, that allows them to sell graphical ads on their sites that are aimed at specific audiences, like car buyers or sports enthusiasts. The system puts users into those groups based on the pages they visit online, a technique known as behavioral targeting.

This allows publishers to sell, say, high-priced travel ads not only on travel pages but also on any page visited by a user interested in travel. An advertiser may have paid 50 cents to reach every thousand visitors to a high school sports page, for example, said Leon Levitt, vice president for digital at Cox Newspapers. “Now it doesn’t matter where the page is on the site,” Mr. Levitt said. “All of a sudden we can sell that page for $15” for every 1,000 visitors who are interested in travel, he said.

They’re also able to sell into the Yahoo network, which gives them much greater online reach than they would have using their sites alone. Local ad targeting through APT and related capabilities allows them to reach Yahoo users in specific markets.

The anecdotes in the NY Times article suggest that the newspapers are doing well with the program:

A similar sales blitz at The Ventura County Star, a small daily north of Los Angeles, netted nearly $1 million in sales in the run-up to Christmas, or roughly 40 percent of what the paper sold in online ads in 2008. The Naples Daily News in Florida did even better: The late-January blitz generated $2 million in sales, or more than half what the paper sold online in 2008. Some larger newspapers have had similar successes.

Yahoo says that the revenue contribution from its point of view is not “material” but the company is optimistic that the relationship will generate increasing revenues over time. It also values the local sales channel that the newspapers provide and corresponding reach into local markets, which Yahoo would probably not otherwise have.

The Yahoo-consortium program is online only and doesn’t affect print newspaper ad sales. Google recently shuttered its print newspaper advertising program citing disappointment with demand and revenues.

Ben Edelman, an assistant professor at Harvard’s Business School, forcefully argues that “Yahoo’s Right Media ad marketplace features widespread ads exactly designed to deceive.” In his lengthy article he offers 10 examples and lots of specific documentation of the kinds of deception he alleges. The ad types in question feature the following kinds of copy according to Edelman:

• “You have been chosen to win a free…”
• “Free” and similar representations with NO disclosure language
• “Free” and similar representations with disclosure language
• Deceptive or questionably realistic offer
• Bait & switch advertising, i.e. offer from creative isn’t present on LP

These ads either are false or fail to make legally required disclosures according to the article. Edelman argues this is going on because:

Right Media is the web’s largest marketplace for “remnant” (otherwise-unsold) display advertising. Sellers of advertising space would typically rather sell their most desirable space elsewhere, where they can get higher prices. So Right Media is left with relatively less desirable ad inventory. Who wants to buy that space? In part, bottom-feeders whose ads have a tendency to deceive.

The article reprints a statement from Yahoo/Right Media defending itself:

“Right Media is deeply committed to providing a high-quality experience for advertisers, agencies, networks and publishers. We have rigorous platform standards and guidelines for our members that we expect them to follow, which include preventing the use of our system in a misleading, deceptive or illegal manner.  For example,  since Exchange members classify their own content, we expect all advertisers to accurately categorize their creatives and associated landing pages and we expect that publishers will select the types of ads that are appropriate for their websites. Our Media Guard tool for creatives also provides additional safeguards for the Exchange. If we learn that an ad is in conflict with laws or regulations, our expectations or our guidelines, we take action to remove it from the Exchange as quickly as possible.”

Perhaps when new Yahoo CEO Carol Bartz takes a look at the exchange/marketplace she’ll clean up the practices that Edelman complains about and generally “kick some butt.”

Not long ago, Google rolled out its “Geolocation API” (via Google Gears). Initially it was intended to enable third party publishers and developers to get location for their apps on mobile devices using a combination of the phone’s inherent location-awareness technologies (i.e., GPS) and Google’s cell-tower database (which has been expanded now to include WiFi locations). However it also works for destkop browsers, provided that Gears is installed on the computer.

Here’s the Google Code Blog discussing the impact:

When we originally proposed the Gears Geolocation API our goal was to make it easy for developers to deliver location enabled web sites on mobile phones. However we realized laptop users would benefit from location enabled web sites too. Today we are adding WiFi signals to the Geolocation API so that laptop users can benefit from location enabled web sites for the first time and mobile users from the increased accuracy. And because the Geolocation API is the same for developers in both desktop and mobile browsers you can even use the same code on both platforms!

In Chrome and Android, with Gears built in, you can deliver a location enabled web site without requiring your users to install a plug-in, but in other browsers they will need to go through a simple plug-in install process. We also submitted a simplified version of the Geolocation API as a WC3 specification and the upcoming Firefox 3.1 plans to support the W3C version directly. The Gears Geolocation API is completely free to developers and users through the default Google location provider.

So what does all this mean? We know about location-aware content and services and their potential in mobile. But what about on the desktop?

It essentially means that developers can tap into location and create more locally relevant versions of their sites or provide locally relevant information without requiring the user to enter location. There are some hoops here though: the user must have Google Gears installed in most cases. This is not true for Chrome users and will not be true for users of the next Firefox browser update 3.1.

If Gears is not installed, users at some point in the process are asked to install it. Then they are asked to opt-in and share their location. There’s essentially a double opt-in process. Google will ask if you want to share location and the app/publisher online will do the same. This is quite cumbersome right now, but as these technologies move directly into the browser, as with Firefox and Chrome, users will just need to allow sharing of their location. Ultimately it will be very much like location sharing on the iPhone.

Yahoo’s FireEagle does this already on a “manual” basis: users tell FireEagle where they are (much like updating one’s Facebook status) and third party sites can tap into the API and get access to that information. Sprint’s (Clearwire’s) new WiMax ISP Xohm provides location-specific content to users on a default homepage. And Skyhook Wireless’ Loki toolbar has been providing locally tailored content for a few years.

Let’s just say that within a year location awareness to within 200 meters (or less) will be available through most desktop browsers to publishers — and advertisers. The current IP targeting methodology used by Google and Yahoo for AdWords and Panama will be replaced with much greater location precision. It will make that customized location map in AdWords a real thing. Targeting will become available by neighborhood and not just DMA/City (Yahoo just added Zip-Level targeting).

This will be easiest for AdWords where end users are on Chrome or Firefox, but it will eventually come to IE as well. Users will need to enable location on the browser but then the ad platforms will be able to tap into that location, serving much more locally targeted ads (provided advertisers create them). This will also be possible for display advertising as well.

I’ve argued in the past that once location-awareness on the desktop gets to the neighborhood level, you get to tap into US Census and other public data (which could be incorporated into AdWords or Panama or adCenter) to allow for demographic targeting on a national scale. This represents — and I’m speculating about where all this will go — a potentially radical transformation of the current state of online and search geotargeting.

Imagine that an automaker like BMW wanted to target its demographic online — I’m guessing 25 to 50 year olds in upper income segments — it could now do that through a search campaign with a high degree of reliability. (Forget about the current AdSense demo targeting.) BMW could bid on all the same BMW brand and generic terms, but those ads could be restricted to users in specific geographic areas, tied to the neighborhood-level Census data (income, age, education, etc.). In other words, it would become possible for BMW to select the audiences to whom it wanted its ads exposed on a national scale (upon the right query triggers) and the system would use the coming improvements in location targeting, assuming the incorporation of Census and other related data, as a way to reach those audiences.

In other words, the same search term(s) list might trigger a BMW ad for one user in location A and no BMW ad in location B. Here’s another interesting scenario, this time with GM. It could show an ad for a car in a certain price range to a person in location A and a different ad for a high-end model in another location. These different ads could both be triggered by the same keywords, but the location/demographic data would determine whether to show the ad at all or which ad to show. You can obviously see the marketing power here.

It would operate largely as conventional direct mail does today (which uses Zip-level lists and neighborhood profiles). And all this would be enabled by more precise location targeting vis-a-vis the browser, as described above. Would such as system be foolproof? No, clearly not. For example, what about work locations where there’s no Census data about audience composition? It also requires better location awareness to be implemented in the browser first and then requires the search ad platforms to incorporate the Census and other data, tied to location.

Nonetheless, this is where I see these geolocation improvements taking the market. They open up a potential revolution for search (and brand advertisers’ use of search) — all tied to better location targeting.

At various times it’s been called AMP or APEX, but today Yahoo introduced its new “unified digital advertising platform,” which the company is now calling APT. With the platform it gained through the Right Media acquisition at its core, Yahoo is positioning APT as a dynamic, open marketplace (dispensing with the term “exchange”).

The central idea is very simple: simplification of buying and selling advertising across the internet. The first customers — indeed the apparent drivers of the initiative — are Yahoo’s newspaper partners.

Search is not a part of APT at this point. But previously Yahoo President Sue Decker said that it would encompass all ad types and formats across Yahoo and its partner network: We are building a cutting edge ad platform that runs across all formats, whether it is search, display, video. It is capable of harnessing the power of Yahoo and the power off Yahoo. But it will also take advantage of emerging formats like mobile, all in an easy to use system.

APT was formally unveiled in New York today, with an appearance by Jon Hamm, the actor who plays advertising executive Don Draper on the popular AMC show Mad Men. Lots of sweeping and dramatic claims are being made for APT and how it will affect online advertising.

Yahoo CEO Jerry Yang blogged about the launch:

Our confidence in APT’s ability to transform the marketplace isn’t based on theory or conjecture. It’s because of the feedback we’ve been hearing from partners who have been working with us side-by-side as we developed and then began testing the platform. In fact, William Dean Singleton, CEO of Media News Group (parent company of the San Jose Mercury News), also joined us on stage today, using words like “extraordinary and “sea-change” to describe how APT will take MNG into the future.

Yang characterized it as a “platform that would be to 2009 what radio was to 1924, TV to 1947, color TV to 1965, and the Internet to 1993.”

Google, AOL and Microsoft all have their own “next generation” ad platforms in the works or various stages of development. For example, just yesterday AOL announced its own: BidPlace.

Clearly APT is consistent with what advertisers, agencies and publishers want: reach, targeting and simplification. But we’ll get to see in the coming months whether it can deliver for them — and for Yahoo.