Yahoo7 takes aim at ninemsn

Yahoo7 was first announced in early December and both companies have since been busy rebranding its Web site, which today launched at www.yahoo7.com.au, replacing Yahoo's previous Australia and New Zealand portal.

"We have spent the last six weeks going from the announcement to actually putting the site together.

"A new marketing campaign will be launched on 6 February to let consumers know that Yahoo and Seven have moved in together," Seven's commercial director, Bruce McWilliam, told reporters in Sydney this morning. The executive will be a member of Yahoo7's board.

Commenting on the launch, chairman of the new joint venture John Marcom said the way people viewed television shows, news and sports had changed very quickly in a short period of time. Prior to his new role, Marcom was senior vice president of international operations at Yahoo.

"In the US, people are consuming TV shows in very different formats -- such as DVD and downloads. This has happened very quickly over the last few months," Marcom said. The executive believes Yahoo7 is in a prime position to capitalise as viewers change the way they consume television programmes.

"We are not trying to cannibalise existing opportunities. If the audience is moving that way then we want to be there to capture them," he said.

The venture was welcomed by Foad Fadaghi, research director analyst firm Frost & Sullivan's ICT practice. The analyst said the partnership was necessary for both companies if they are to compete with ninemsn.

"This is one of those scenarios where for both companies to attack the local market in the best possible way, a partnership is necessary. If you look at ninemsn's online reach it is certainly higher than Yahoo's, but the complementary content from Seven will go a long way to address that," he told ZDNet Australia.

Although the local market is unlikely to see additional mega-partnerships like Yahoo7 and ninemsn develop in the near future, Fadaghi expects a flurry of acquisitions as companies attempt to capture a bigger slice of the pie.

"You are going to see a flood of mergers and acquisitions. I don't think there are any large deals left to be done in the local market but I think you will see some of the larger fish eating the smaller fish and building market share," he said.