Yahoo Says Its Mobile Strategy Is Working

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Yahoo is learning that mobile applications don't cannibalize its PC-based services, said a company executive Wednesday, as he also outlined the ways that Yahoo is approaching the mobile market differently from its competitors.

Yahoo has found that customers who check their Yahoo e-mail on their PCs and mobile phones during any given month spend 82 percent more time with Yahoo than someone who only checks e-mail on their PC, said David Ko, senior vice president for Yahoo Mobile, speaking during a keynote at the CTIA conference in San Diego.

"This tells us the experience isn't cannibalizing but complementing the PC experience," he said.

That discovery may be helping Yahoo to continue to aggressively pursue the mobile market. The rapidly growing search and services market for mobile phones is considered an open game, with no provider yet staking a clear lead. Yahoo competes with Google and Microsoft, as well as startups and operator-branded services, in attempting to win mobile search and services market share.

Ko described Yahoo's approach to the mobile market as different from competitors like Google and Microsoft, and said its strategy is working.

Yahoo isn't going to build a phone or an operating system or try to become an operator, he said. "Instead we focus on building partnerships," Ko said. The search provider is also building mobile applications and generating revenue through advertising for its partners.

Yahoo has partnerships with 100 mobile operators and phone makers, Ko said. Those deals typically don't include just one component, like embedding a Yahoo search bar on the home screen, but often include a suite of services like e-mail and instant messaging, he said.

The partnership strategy is working, he said. "We have a tremendous amount of users who come to but a tremendous uptick in usage from partnerships," he said.

The search giants have been competing for such relationships for years, and Google and Microsoft also have similar deals with operators and handset makers around the world.

Yahoo also thinks it will get a leg up on competitors by focusing on Asia Pacific and emerging markets. While worldwide there are four times as many cell phones as PCs, in those regions that ratio grows to as much as eight to one, Ko said. In Indonesia, Yahoo has two times the number of people searching from mobile phones than over the PC, he said.

In those regions Yahoo is being aggressive in its attempts to woo customers. In Japan, for example, one operator sells a phone with a physical key that takes users directly to Yahoo. "You'll see that extending to other areas in Asia Pacific," Ko said.

Ko also said that its efforts at making mobile advertising less intrusive are paying off. Despite the economic downturn, leading brands are advertising to mobile phones "and no longer testing the waters," Ko said.

On some mobile advertising platforms, when a user clicks on an ad, a new window opens, sometimes kicking the user out of the application he or she was using. "If we make clicking on ads painful, users won't come back," Ko said.

Yahoo has begun displaying ads that when clicked simply expand for a brief period and then revert to their original size.

Ko spoke during the keynote on the first day of the CTIA conference, which goes through Friday.

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