Change is entertaining for Yahoo

 Web giant finds success with live music, user-generated content

With such traditional media mavens as Terry Semel and Lloyd Braun gone from Yahoo and the company recently deciding to better integrate its entertainment offerings, the way that the Internet's No. 2 search engine treats entertainment has clearly shifted. Among other things, the company has changed its focus from original productions to surrounding established brands with supplementary content. The Hollywood Reporter West Coast business editor Paul Bond spoke of these changes with Karin Gilford, GM of Yahoo Entertainment.

The Hollywood Reporter: Your boss, (head of entertainment and video) Vince Broady, has said decisions need to be made faster. Give me an example of how Yahoo Entertainment was hurt by slow decisions.

Karin Gilford: I can't cite a specific example, but under the old structure we had three GMs: one managing games, me managing movies, TV and (our celebrity news portal) OMG, and another managing music. We're trying to operate now in a world where consumers don't think in those distinct vertical categories.

THR: Speaking of the old regime, it seems like Terry Semel and Lloyd Braun assumed that what worked on TV also might work on the Internet. Are those assumptions wrong?

Gilford: Look at all the things that changed for TV in the last 18 months. It's a whole new world with digital TV and the Internet. I saw the same phenomenon with digital music in 2000 and 2001, where all the audio was coming online in ways the record companies didn't want. Now that the networks are being more progressive and the content is available in high quality, it's obviating the need for the consumer to have to steal it. With the plethora of TV content available, what we can do is cut across networks and cable channels and navigate the breadth of content.

THR: Does that mean Yahoo is no longer interested in creating exclusive entertainment content for the Internet?

Gilford: We have a lot of barometers at Yahoo that show us what people are interested in. I'll give you a few examples of what we created that has been successful. In music, it would be Nissan Live Sets, a program where we take artists that people love and shoot them on our soundstage — live performances people can see and hear nowhere else. Another is Buzz Sessions, like we did around "American Idol" that got a ton of traction. It was a four-minute Internet recap show that we'd put up the morning after, when all that watercooler talk was happening.

THR: Are people more interested in seeing user-generated stuff on the Internet or traditional movie and TV content?

Gilford: The magnitude of volume consumed is in the larger brands. Our strategy for user-generated content is to harness it toward an end, where we put it in a relevant framework, like we did with the MTV Movie Awards, where we let spoofers spoof the movies. Those with the five top submissions went to the awards show, and the winner got the Golden Popcorn onstage presented by Samuel L. Jackson on live television.

THR: How does Yahoo profit from that?

Gilford: With sponsorships. And it's a great demo match, getting the Yahoo Movies brand out there. It also helps us drive unique users to the Yahoo movie property, which sends the whole business cycle spinning.

THR: How will Yahoo get into the distribution of TV shows and movies?

Gilford: We're a distributor of Hulu. And we're in talks with other TV networks. The TV market is extremely hot now because the ad-supported, free business model, excitingly, is translating to the Internet. But I don't think the killer app for movie distribution over the Internet has arrived yet. There's some interesting paradigms for early adopter user groups, but I'm looking to do things that appeal to a large number of users, and that just doesn't exist now for feature films. What's exciting in the movie space is trailers, which have become events in and of themselves.

THR: Back to TV: Why does a network need Yahoo when they have their own Web sites for offering episodes of their shows?

Gilford: They're fishing in their own pond with that strategy, which is fantastic. But they need Yahoo to expose their brand to new users. So if folks don't make an appointment with their couch or their TiVo because they're not sure they want to make a commitment to a show, the Internet makes it easier for them to sample the show first, and then they might adopt a show even if they have never watched it in a traditional manner.

THR: What at Yahoo Entertainment is getting the most traction?

Gilford: Video, including movie trailers. We were also the first site outside of Apple to introduce HD. And, obviously, the TV space has grown tremendously. Plus we're seeing that video games are getting big. But the most exciting thing in the last 12 months is the launch of OMG, our celebrity news and gossip destination, is a great example of reading all those tea leaves to identify what's resonating with Internet users.