There’s more on the Yahoo! contextual ad network from JenSense and David Jackson at the Internet Stock Blog and we find all this talk pretty exciting, in terms of what it might mean for the marketplace.

Yahoo/Overture’s contextual advertising network could very well emerge as a powerful competitor for Google’s AdSense. Right now, Google is the only game in town. Sure, there’s other small players (such as Kanoodle), but no one who has a scaleable network or critical mass with advertisers. Affiliates have a tough time getting in the network and even if they do, they’re not making a whole lot of money.

This reminds us of the days when Overture used to rule the roost, back then they were GoTo going up against LookSmart. They used to call all the shots because they had the backfill of advertisers, until little guys Google came to town and broke up their monopoly.

Another part of what makes an alternate contextual network so appealing is the transparency factor. Google currently won’t disclose the percent of revenues (rumored to be increasing) that publishers are getting as affiliates and their terms of service prevent affiliates from openly discussing their experiences with AdSense.

Another major player in the market would mean Google won’t have as much leverage over publishers and as a result, publisher revenue share is likely to increase. A monopoly on this business basically exists right now, despite Google’s insistence that they’re “listening” to advertiser and publisher frustrations. Right now Google has little incentive to make any of the requested changes, though that may change once robust competitor like Yahoo forces their hand.

In short – competition is a good thing.

This entry was posted on Wednesday, March 9th, 2005 at 12:26 pm and is filed under Advertising: Contextual, Advertising: Distribution, Search: Innovations. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.