Seven Network Limited and Yahoo! Inc. will combine their online, mobile and IPTV businesses in Australia and New Zealand. The strategic partnership brings together Yahoo!'s Australian internet business, Yahoo! Australia & NZ, and the online assets and television and magazine content of Seven Network, one of Australia's largest media companies.
Under the terms of the agreement, Seven and Yahoo! will form a new 50-50 holding company that will own Yahoo! Australia & NZ. Seven and Yahoo! will each hold three of the six board seats in the entity.
Yahoo! Australia & NZ and Seven will be combining their online teams and are expected to launch a new name and an online presence in late January, coinciding with Seven's coverage of the Australian Open and the Olympic Winter Games in Torino, as well as the opening weeks of the 2006 television season.
The companies say their vision for the combined teams is to create the best entertainment, information and communications experience for Australian internet and mobile users.
Chairman and chief executive officer of Yahoo! Inc, Mr. Terry Semel, said: "Yahoo! and Seven have very complementary businesses and brands, and we see this as a tremendous opportunity to build a leadership position in Australia. This is the best combination to benefit from increased broadband penetration, rich media consumption, and the growing cross-media advertising spend. Together, I believe we can deliver the most engaging and innovative rich media experience for Australian audiences and advertisers."
The online experience for consumers is expected to evolve over the next twelve months, but existing Yahoo! Australia & NZ users will continue to receive all services currently available. Additionally, Yahoo! will combine its global content, products and technology with Seven-owned content to create an Australian online media and entertainment experience rich in video and locally relevant content.
New consumer offerings will ultimately be available across online, mobile and IPTV in areas such as news, sports, entertainment, TV, games, music, and travel. Seven will also contribute AUD$10 million to match the existing development capital in the business, offline promotion through the Seven Network and Pacific Magazines, as well as Seven's 33 percent stake in mobile solutions provider m.Net Corporation Ltd, which is subject to obtaining required consents.
Advertisers will also be able to purchase combined offline and online sponsorships across Yahoo! Australia & NZ, the Seven Network and Pacific Magazines.
According to the ABVS the Australian online advertising market was nearly a half billion dollars in FY04/05, surpassing cinema and outdoor advertising, and is expected to grow 21 percent year over year for the next five years.
As a result of today's agreement, Yahoo! Australia & NZ becomes the key platform for Seven's ongoing development beyond broadcast television and magazine publishing as it builds its Digital Media Division - leveraging its strengths in the creation and marketing of content into new and rapidly evolving forms of technology.