Episode 210

Yahoo's Kat Downs Mulder on the portal's comeback

Everything comes back in fashion. Why not the portal? Yahoo is a true legacy brand of the internet. An OG portal that failed to stem the rise of Google, missed on buying Facebook and for the last four-plus years has been a ward of private equity under the ownership of Apollo. It’s also found the market turning in its favor in many ways.

Kat Downs Mulder, svp and general manager of Yahoo News and home, joined me on The Rebooting Show to discuss the portal’s comeback.


Transcript
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Welcome to the Rebooting Show.

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I'm Brian Marey.

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I'm joined today by Kat Downs Mulder.

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Kat is the SVP and general manager of Yahoo News and Home.

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She is a veteran of the Washington Post.

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We're gonna start, we have to start talking there because, yesterday was

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a very difficult day, for the Post.

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but I wanna get all into what Yahoo is building.

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But as I said, Kat, we gotta start on a down note.

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With the posts.

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I'd be remiss if I didn't, obviously not a great, day, really for the

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poster or publishing and, yeah, you spent almost 15 years there, right?

Kat:

Yep.

Kat:

Almost 15 years.

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and you know, you were Chief Product Officer, and

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the managing editor there.

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obviously difficult, but like, what is your diagnosis?

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I mean, obviously you left in 2022.

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What, what's your diagnosis of sort of what went wrong?

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Because I mean, like, in some ways, and, and look, there's, there's time to to, to

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patch it up, but like we, we are 13 years into when Jeff Bezos bought the Washington

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Post and at Digiday I had reporters who wrote all these stories about like the

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amazing progress that was being made there in the early years and, and then

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things kind of went a little sideways.

Kat:

Yeah, I mean, it's been a while since I was there.

Kat:

I wasn't there since 2022.

Kat:

Gosh, it's awful.

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What's happening there?

Kat:

It's a really sad, really, just, I've been in contact with tons of friends

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and colleagues, who are laid off in this latest round or who are still there.

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all of whom were doing tremendously important work.

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I mean, I obviously believe very, very deeply in the mission of the

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Washington Post, having spent, like you said, 15 years there, in a variety

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of different roles and believe that the, the role of the institution is.

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Critically important and that it is one of many journalism institutions

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that we need, to play an important role in the functioning of society.

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So I'm really sad that this has happened.

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you know, I'm sure there are a lot of reasons for it.

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I can't speak to the, the most recent.

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Reasons and what's sort of going on there.

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but I'm really hopeful that they figure it out and that

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they continue to do great work.

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I mean, there's still a lot of really good people there, who are working

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hard to put out the news, and continue to hold the powerful to account.

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So I'm very optimistic that that happens.

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I mean, it's been, it's been painful.

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but, We're just gonna have to kind of, I think, help those who, who've

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left, who've left the post, ideally find, find new ways to, to participate

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in journalism in the future.

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And, I'm hopeful that those talent lands in, in good places.

Brian:

Yeah, and I think one of the concerning things is like a lot of

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this, you know, some of it is trying to unpack what's specific to, to the

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post and what is, a broader structural change that is obviously layoffs.

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And this, these were like big cuts at a very marquee publication, but you

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know, in there, you know, they've, they've suffered a lot of the same.

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Exogenous, you know, pressures that a lot of publishers have faced, and particularly

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it's hit news publishers hardest.

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Right.

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so I'm just wondering like what, 'cause you know, look, I've talked to, spoken

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to lots of people and some people are like, maybe these businesses don't work.

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Like, honestly, I, I've gotten like some, I'm like, okay, if, if they

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can't figure it out, then like.

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Is this, are any of these businesses gonna work?

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Like, I, I really do think, I know you probably wanna move past this,

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but like it's really a bad situation because people are questioning whether

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this is even a viable field, honestly.

Kat:

Well, I think there's lots of examples of where it is viable.

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and there's lots of places that are being really creative

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about trying to figure it out.

Kat:

Look, it's not easy.

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I mean, we all know that like there is a tremendous amount of structural

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pressure on the publishing industry and everybody's trying to adapt to that,

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whether it's AI or social or changing user habits or the rise of misinformation,

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like it, all of that creates a really.

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Difficult environment to operate in, not to mention, you know, monetization

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pressures and all that comes with that.

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I mean, it, it's a hard environment to operate in, but I am a strong

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believer that we will figure it out.

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and the market economy is leading to all kinds of interesting solutions.

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The rise of the creator economy is really interesting.

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You know, people driving, you know, broadening their businesses to

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include more products and tools.

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Of course, New York Times is a flagship example.

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You've got places like Sipho doing more with events.

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You've got more boutique and niche, niche places, really focused, laser focused on

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their audience, which does work, right for driving loyalty in the audience

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and attracting the right advertisers.

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So there are models that work, but I think it takes a tremendous amount

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of discipline and focus, consistency in the way that you manage that.

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and you know, there's no doubt that it's hard, but I think there is a path forward.

Brian:

So just to, to move it to Yahoo, like what, what do you see as, as Yahoo's

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role now in the publishing ecosystem?

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Because like, I mean, I've, I've, I've covered Yahoo for, for a long

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time and it's gone through so many.

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Different iterations.

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Right.

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And in some, and in some ways, like it almost, I don't wanna say

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it got forgotten, but it was like, kind of like, oh yeah, Yahoo.

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You know, and Yahoo's like, you know, again, it has gone through

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a bunch of different lives.

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You know, I remember the Carol, the Carol Decker experience, like I remember that

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she was, I like that she cussed a lot.

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It was fun.

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but, talk to me about what Yahoo is, is now.

Kat:

Yeah, I mean, absolutely.

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Yahoo's been through a lot.

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Yahoo's been through 30 years.

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We just celebrated our 30th birthday recently.

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and there's always ups and downs, as you get to a birthday that big.

Brian:

Yeah.

Kat:

Um, but you know, today I think our function is, is much like what,

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what Yahoo was when it started out.

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You know, our.

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Role is to help people find the best content on the internet.

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It's to help them have a starting point for their day.

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It's to help 'em bring it all together and, and bring clarity to the

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chaos and make sense and the noise.

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You know, we think about that.

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Providing that signal a lot.

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So in a world that's increasingly chaotic, where do you start making sense of it all?

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and we wanna be that, we wanna be that starting point.

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And I think that starting point has tremendous value today, because the

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internet is so, I mean, and just increasingly fractured and information

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everywhere and don't know what to trust.

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And so having a space where.

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The content is vetted and quality and, the services that you need

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access to are brought together in one space, I think is a tremendous

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advantage, advantage for Yahoo.

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and I think that function is, is critically important, in this moment.

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and we're, we're building on that.

Brian:

Okay, so like the portal is back,

Kat:

The portal is back, but it's, you know, it's mo it's

Kat:

the modern portal, right?

Kat:

Like you're not necessarily looking for addresses of websites, you know, where you

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might have been doing that 30 years ago.

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You know, the portal, the portal never left.

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It just evolves, right?

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Where now we're.

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Now we're thinking about how do we help you find the most interesting creators?

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Or how do we help you find authoritative publishers on a certain topic?

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Or how do we help guide you to the right product to buy?

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Or, you know, the, the how do we help you like compose the right

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email responses to things, right?

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All of those things are kind of, relevant and important to you and.

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We know that people are juggling too much, not just, you know, too

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much information, but too many things to do too, too long of list.

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and so that function of really helping them and synthesize

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and orient them, I think.

Brian:

Right.

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so just to unpack it like, I mean.

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Yahoo.

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Like, it, it's interesting 'cause it's important, like you're, you're a

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publisher but you're also an aggregator.

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But more than that, like you're, you're a utility provider.

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You know, people come to Yahoo, like, not many publishers can,

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can really say that they're gonna be the start of people's stays.

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You know, maybe the New York Times, maybe a few others.

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But really it's, that's typing, typing publisher URLs into a browser.

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I don't know, like maybe I, maybe I have spent too much time on X

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with the, you've got a year left.

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Like, because AI is gonna like, take over everything.

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I just, I don't know, but I just don't believe that that is gonna

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be the future of publishing.

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I just, it's just hard for me to believe that.

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People check their email all the time and they check their stock portfolios.

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and you know, that combination of, of utility with, you know, aggregation and

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now differentiated search products seems like it could be something, something

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pretty interesting like, explain.

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Explain how that flywheel works because you know, right now a lot

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of the distribution patterns are changing quite a bit on, on the

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internet and, and most publishers are dealing with steep declines,

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particularly from search traffic.

Kat:

Yeah.

Kat:

So I mean, I think that's one of the things that Yahoo is unique with

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and that I, you know, one of the reasons that, that I joined Yahoo

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as we're sort of reinventing all of our products, and rethinking the

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value that we can add into the world.

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We have a tremendous amount of utility products and overlapping

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products that build daily habit.

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and that bundle of things is.

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Is a really powerful tool.

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So we have a massive amount of direct traffic, audiences who have loved Yahoo

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products and audiences, that are really responding well and deepening their

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engagement with our existing products.

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And that's because, you know, the, the, the, the most engaged Yahoo users

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are using multiple products, right?

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So it's a large body of direct users and then users of multiple

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products within the Yahoo portfolio.

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So like 80% of the people that come to the homepage are using multiple

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Yahoo products, whether that's mail.

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Or whether that's search or now scout, whether that's

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fantasy, or portfolios, right?

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And so we try to bring those tools together in a way that helps them connect.

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You know, not just learning something from a piece of content, but then taking

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those next actions into doing something.

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Managing your fantasy team, managing.

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Portfolio, et cetera.

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I think that combination of things is really, is really powerful and useful.

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and what we've been trying to do is take that direct audience, and deepen that

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engagement and through that add value, you know, that attracts a new audience.

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And I think that's really been working.

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When you look across our portfolio, we've reinvented everything over the

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past few years really with an eye towards serving those audiences and

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deepening that engagement to create resilient, you know, resilient.

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Over time, despite changes in overall

Brian:

Yeah.

Brian:

So how much direct traffic does Yahoo have?

Kat:

a really significant amount, more than three quarter

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of our traffic is direct.

Brian:

Right.

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And most publishers cannot, cannot say that.

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So I mean, in some ways it is interesting because like through all the changes

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that that Yahoo has gone through.

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Like this is fair.

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Fair.

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Fairly similar to how it was originally.

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I remember, I remember Terry Sel used to, you know, describe it.

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'cause I think he came from parks, like, like an amusement park.

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You come in and there's different rides and you go on different, you know,

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but you, once you get into the park, you know, there's all sorts, sorts of

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different things that you can, yeah.

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So tell me about the news, the, the, the role then of news in that.

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Because I think the, I think the role of news is changing in a, in a lot of ways.

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And I think we're in.

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The midst of that, like there's always gonna be news obsessives and people who

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go directly to news sources or people who need news to do their job, et cetera.

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But in many ways I, I feel like news will become a feature, and in many cases

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of other products, and in some ways, like within companies, the reality is

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the news is a support for other things.

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You mentioned, you mentioned semaphore, like, you know, the majority of their

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business is not directly monetizing news.

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It isn't.

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and you look at time, you look at most of the magazine brands there,

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it's in support of a different, a different type of business.

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And I, I believe that is inevitable.

Brian:

I mean, you could even argue Bloomberg is in support of the, the terminal really at

Kat:

Mm-hmm.

Brian:

so talk to me about how, how news fits into that.

Kat:

So, yeah, I'm a big believer in that like news is a, something that works

Kat:

best with a compliment of other utilities and services that create loyalty.

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So that, that's what it is for us as well.

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Like news is, news is part of a whole.

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environment.

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and if you look at things like our homepage redesign or our app

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redesign, you'll see that there's a, there's a lot of these services,

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together with the news, right?

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And what the news helps to do is create a point of orientation,

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a point of accessibility, right?

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To answer that question of what's going in and on in the

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world and what's relevant to me.

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I think that continues to be important, but it's not the, the

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only thing that people need, right?

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They need to be able to take that information and act on it.

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And so we've been really focused on that using Informa you, you

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know, helping people find the news that they need to know.

Kat:

And then once they get that news, sort of what, what do they do with it?

Kat:

What do they, what next steps do they take after they, they get it?

Kat:

I think people continue to wanna know what's going on.

Kat:

Right.

Kat:

It just looks a little bit different than it did years ago.

Kat:

Right.

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because it's originating from so many places.

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it's not traditional text, you know, necessarily.

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It's changing in a lot of ways, but I think that orientation

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piece remains important.

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so in all of the, you know, in all of these tools, it might not be called

Kat:

news, but the information product, is still, it's still an essential aspect.

Kat:

It's just not the only thing.

Brian:

Right.

Brian:

Okay.

Brian:

And so explain like how you.

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Balance, like sort of the original, I mean, 'cause Yahoo's like both a

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publisher and an aggregator kind of always has been, I guess in the early

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days it wasn't as much of a publisher.

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but how do you balance that?

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I mean, because you, like you're both, you're a partner for publishers, but

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then you're also like an original, obviously Yahoo Finance is a massive

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property, Yahoo Sports, et cetera.

Kat:

Yeah, I mean, so we think about it as complimentary.

Kat:

So a huge amount of what we do is, is aggregation a thousand

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plus publisher partners.

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and our users get a lot of value from that.

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I think they love getting news from a variety of sources, and

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that's a, a, a powerful advantage.

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We also create some content.

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the content that we create in Yahoo News, specifically in news,

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entertainment, and life is really about adding context and helping people.

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Helping people, helping, you know, helping figure out what's going

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on and sort of, again, guide them through some of that aggregated stuff.

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we don't produce a tremendous amount of originals.

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We really don't wanna duplicate what we have already from our aggregated content.

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So we're focused on sort of how do we add an additional layer of value.

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a lot of our original resources are, you know, not just writing, writing

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stories or doing live coverage, pulling together, stuff that some of

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our partners are doing, but also on sort of curation, which is finding

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the good stuff and sort of explaining which things you wanna go to and why.

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I think that original content helps to, provide that additional layer of

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signal, on the noise, whether it's through, content by people you know,

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and like, people likeman who covers entertainment for us, or through, you

Kat:

know, just content that helps synthesize the other stuff in the network.

Brian:

Right.

Brian:

you know what I miss?

Brian:

I miss, Yahoo News Digest.

Brian:

The, the Sumy.

Brian:

I mean, that was one of the, one of the like million like Yahoo

Brian:

ACCC acquisitions over the years.

Brian:

That was, was ly a very, it was a smaller one, but like I thought

Brian:

that was a really good product.

Brian:

I'm just gonna put it out there.

Brian:

If you wanna bring it back, bring it back, but

Kat:

It was a good product and some of the spirit of the, of the Yahoo

Kat:

Digest is in the Yahoo News app today.

Brian:

I know they say that, but it was like, it was Finishable and I

Brian:

think, I forget the guy's name, Nick.

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Alessandro or something like he who started it, he was a young guy.

Brian:

He was really, I saw him speak one time.

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He was really smart.

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and he probably got outta the news business pretty quickly.

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But anyway, when he was, when he was a child and he was doing this, you

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know, he made it finishable at the time when everyone was, you know, it was

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like, you're done, you're caught up.

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Like it's over.

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Like, and that's like.

Brian:

I think that's smart.

Brian:

but anyway, that's my, that's my one product thing.

Brian:

How do you think the, the sort of news product having been, like,

Brian:

needs to change and how are you, how are you thinking about that?

Brian:

Right, because it's another one, just like going to a URL, it's hard for me

Brian:

to believe it is, is not gonna happen.

Brian:

It's hard for me to believe that these articles on web pages are gonna be

Brian:

the default of how people get informed about what's going on in the world.

Brian:

Just seems

Kat:

Yeah, I think it's gonna evolve a tremendous amount.

Kat:

I mean, I think this is global across, across the news industry.

Kat:

It's already, it's already happening.

Kat:

Right.

Kat:

A, a ton of people get their news from social media.

Kat:

It looks nothing like articles, right?

Kat:

It looks like people telling you things through videos or

Kat:

through posts and short snippets.

Kat:

And, it's a very different model than what you're encountering on most publishers.

Kat:

so we're, you know, we're embracing that.

Kat:

Like we're, we're making our product much more modal, multimodal

Kat:

with, with video and audio.

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have a mixed media feed that we've just introduced that you

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can opt into on the homepage.

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that's gonna be much more visual and much more.

Kat:

Just have a little bit more of a community layer where we highlight

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things like what people are talking about with different stories.

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let people, share and react to things still with sort of that trusted news

Kat:

at the core, but really try to get, if we wanna aggregate the internet, we

Kat:

have to aggregate more of the internet.

Kat:

Right?

Kat:

It's not just.

Kat:

those sort of text stories in a traditional headline feed, but really

Kat:

thinking about how are people consuming information now and how do we make

Kat:

that a much more multimedia experience.

Kat:

so we're definitely thinking a lot about that.

Kat:

We've introduced a lot of those features in our app as well.

Kat:

I think you're gonna continue to see that evolve throughout this year,

Kat:

with more visual features, more social features, just letting publishers and

Kat:

creators, become more active, you know, become more active in the platform.

Kat:

versus just sort of a flat kind of syndication.

Kat:

So I think it's an exciting space to be in.

Kat:

I think while people are tr reading traditional news less overall because

Kat:

they are shifting social or maybe they're having conversations with

Kat:

ai, there still continues to be this.

Kat:

Desire and need to know what's going on to be informed and also to be entertained

Kat:

by people that you know and trust, or institutions that you know and trust.

Kat:

and so that's really at the heart of kind of what we're building, is

Kat:

how do we open up to more of that.

Kat:

Through things like our creator program or working with publishers to bring in

Kat:

more of the content that they're creating, for other formats, not just, you know,

Kat:

publishing on the website, but also the things that they're publishing on social.

Kat:

How do we work with them to bring those things into our ecosystem as well?

Kat:

So we have a lot of plans for making the product, much more dynamic in

Kat:

those ways, throughout this year.

Brian:

And so how do you like work with publishers and creators?

Brian:

I mean, I assume these things are going to, I hate the word creators,

Brian:

but like they, they're gonna merge, you know, I mean, people make stuff

Brian:

like, at the end of the day, I don't know what, you know, and, and.

Brian:

Some are creators, some are publishers.

Brian:

I don't know what, maybe if you have an HR department, you're a publisher.

Brian:

I don't know what what the difference is, but how do you,

Brian:

how do you end up thinking that?

Brian:

Because look, the reality is there's a lot of.

Brian:

A lot of the energy it has shifted from institutional media to this, you

Brian:

know, more individual, led media and, and a lot of the bad stories are,

Brian:

are on the institutional media side.

Brian:

There's, there's a lot going on on the individual side that is

Brian:

doing really well and it's growing.

Brian:

and that is just the marketplace has shifted and people are gravitating.

Brian:

to other places.

Brian:

I mean, this was, you know, will Lewis, maybe he's said it, you know,

Brian:

and not politically correct, but like he said, nobody's reading your stuff.

Brian:

And like it was, and, and the analytics, and this is something Matt Murray had

Brian:

mentioned in his note, again, a little obliquely, but like the, the numbers

Brian:

and the numbers and the, a lot of the attention and focus has shifted

Brian:

away from institutional publishers.

Kat:

Yeah, I mean, there's a, there's a, a lot of different

Kat:

threads in what you just said.

Kat:

I, I think that one of the things that's most interesting about

Kat:

creators or independent journalists, I mean, you're in this zone as

Kat:

a, as an independent journalist.

Kat:

Is that they know their audiences so well and they are laser focused on serving

Kat:

those audiences and creating content that's incredibly relevant to them.

Kat:

I think it takes a tremendous amount of discipline as a larger institution to do

Kat:

that with a tremendous amount of focus, and to make the kind of deep connection.

Kat:

So I think that's part of what, what sort of fueled the rise of this independent

Kat:

journalism and sort of in terms of how publishers and creators are different.

Kat:

I also see them.

Kat:

The, the lines are increasingly blurred.

Kat:

I mean, internally, we're now just talking about it as contributors, right?

Kat:

Contributors to the platform, whether they're small and independent, where

Kat:

they're a five person business, where they're, whether they're

Kat:

hundreds of person businesses, right?

Kat:

There's similar needs across that whole stack of contributors.

Kat:

And what you wanna do is enable them to build a business, right?

Kat:

To, to be able to build a business, to be able to connect with

Kat:

audiences, to be able to, communicate with those audiences, right?

Kat:

All a sense of quality and, and to be able to bring that wide of perspectives.

Kat:

so I think that, you know, the creator economy in, in my view,

Kat:

or the independent journalism economy is, A really bright spot.

Kat:

Like it's a, it's awesome to see so many people thrive.

Kat:

I think it's gonna evolve in the future.

Kat:

You know, there's an open question about how many independents can

Kat:

sustain independently and will they need to kind of group up or

Kat:

bundle up, more as time continues.

Kat:

just due to how, you know, how sustainable is it to have a, a

Kat:

million independent subscriptions.

Kat:

But even so, the way it transforms the dynamics of the, the publishing ecosystem.

Kat:

Is really, I think, great for our access to information, right?

Kat:

Because we're hearing from a lot more people, they're able to, they're

Kat:

able to write things, that maybe they otherwise wouldn't have written.

Kat:

and maybe it offers a new model for how larger publishers think about.

Kat:

Incubating, incubating and supporting talent.

Kat:

And I think those organizations that have adapted to this way of incubating

Kat:

and supporting talent have done better.

Kat:

and that's one of the reasons why I'm really bullish about the programs that

Kat:

we're building at Yahoo in terms of bringing in those independent creators.

Brian:

So what are you doing with explain the Yahoo Creator Program forever?

Kat:

So we have, a program where we let creators, you know, either

Kat:

recruit them or they apply into our program, trusted creators.

Kat:

We let them come into the, the platform and then they are able to

Kat:

publish within the platform in a similar way as our other publishers.

Kat:

So this, these contributor model, which is, you know, people, people are

Kat:

able to create content for the Yahoo network, either syndicate or create

Kat:

original content for our network.

Kat:

and we've really been focused on growing that creator.

Kat:

Recruitment effort primarily across lifestyle topics, to just

Kat:

fill out the, the content corpus.

Kat:

So what, what stories do we have access to, what people do we have access to?

Kat:

And then empower those creators with a toolkit to connect with,

Kat:

with their audiences on Yahoo.

Kat:

that program is, is, you know, still pretty, pretty young for us.

Kat:

we have about 200 creators on the platform, but it's growing a lot.

Kat:

Like we have, you know, four times as much content.

Kat:

You know, being published now as we did about a year ago.

Kat:

So we're growing it pretty fast.

Kat:

and we're gonna continue to invest in that this year, both in the toolkit

Kat:

for creators and the toolkit for publishers to, you know, manage, you

Kat:

know, actively manage and maintain community and audience on Yahoo.

Kat:

and so it's a, it's been a really great, great addition to

Kat:

the publisher content that we.

Brian:

Okay, so you'll help creators monetize?

Brian:

Yeah.

Kat:

Mm-hmm.

Brian:

'cause that's

Kat:

Yeah.

Kat:

So right now we have a revshare model that's similar to

Kat:

what we do with publishers.

Kat:

We have, we have revshare and affiliate revshare, models with creators.

Kat:

but certainly, you know, as we think about the future, looking at other ways to offer

Kat:

them support as they, you know, again, build, build business on the platform.

Brian:

Right.

Brian:

I was, I was excited as someone who has followed Yahoo for a long time, to see

Brian:

that Yahoo and search back together, you know, 'cause I mean, obviously you've

Brian:

been doing search for a long time, but, you know, Yahoo has a long history.

Brian:

Of search.

Brian:

I mean, I, and it's many sort of like near, near death experiences.

Brian:

I think, like, you know, I, I was covering it when like Google was, you

Brian:

know, we went from a portal era to a search era and, you know, I, I guess

Brian:

we're, we're going into an AI era.

Brian:

Maybe, it seems that way.

Brian:

but this actually provides an opportunity for, for Yahoo.

Brian:

it came out with a, and this is separate from, from Yahoo's search.

Brian:

Right.

Brian:

But to me it's all in this, the discovery, with Yahoo's Scout.

Brian:

explain what you're trying to accomplish there and, and why, why Yahoo's going

Brian:

back to this, like, I mean, it would be easier, easy to sort of skip this.

Kat:

Yeah.

Kat:

Well, I mean, I think what's happening in the the world is that there's a

Kat:

tremendous opportunity to help people.

Kat:

To be useful to people with the tools that are available through generative ai,

Kat:

and I think Yahoo is an amazing position to do that with the network of users

Kat:

that we have and the data that we have.

Kat:

So we've just introduced a new product called Yahoo Scout.

Kat:

Scout is an intelligence layer that goes across all of our platform that's

Kat:

powering features in mail and search and news, things like K key takeaways

Kat:

or our daily digest or email summaries and all that kind of stuff, right?

Kat:

There's an intelligence layer component to Scout.

Kat:

Then there's our answers engine, which you can access at scout.yahoo.com.

Kat:

which is, you know, yahoo's take on what generative search should be.

Kat:

and you know, you can, you can ask it any question and it'll,

Kat:

it'll produce an answer for you.

Kat:

and it's, I think what I love about it is that it has a lot of, a lot of texture

Kat:

and a lot of connection to the web, right?

Kat:

It's not sort of a, a tight walled garden of text with tiny footnotes.

Kat:

It's a really active.

Kat:

Product where, you know, we really try to bring, the citations and the, and

Kat:

the links out and the data to the fore.

Kat:

and I think this is a space where Yahoo shines because we have, such

Kat:

a wealth of data from our users.

Kat:

We have so much access to great content, and a ton of

Kat:

experience, as you said in search.

Kat:

And we can bring all that to bear in building something that I think is,

Kat:

much more accessible and friendly than a, than a lot of the other

Kat:

products that are out there right now.

Brian:

And is, I mean, do you see the data, I mean, will this

Brian:

send more traffic to publishers?

Brian:

I mean, I, I saw some.

Brian:

A, a report recently that was done, that AI overviews on Google's

Brian:

have led to 58% fewer clicks.

Brian:

and this is just confirming, I mean, publishers, you know, Google was

Brian:

out there, saying, I don't know, they were talking out, out of both

Brian:

sides of their mouth, in my view.

Brian:

because everyone.

Brian:

It's like it's raining and they're telling us that it's not raining.

Brian:

It's like, come on.

Brian:

Like it's raining.

Brian:

Like every single publisher, not every publisher, but just about all

Brian:

publishers were seeing far less traffic.

Brian:

Okay.

Brian:

And then right after AI reviews, it was pretty obvious using the product

Brian:

that people are gonna click less.

Brian:

and now it's, it's 58% less.

Brian:

So yeah, it was true.

Brian:

It was raining.

Brian:

is this, this is, is, do you see that this sends like traffic out to publishers?

Brian:

Because I think, you know, the.

Brian:

The direction of travel seems to be that, at least with with Gemini and

Brian:

with chat, BT, is that you simply don't have to click, click a lot.

Brian:

That is the, that's embedded in the product.

Brian:

I mean, like, I, so I don't understand like, I mean, the entire product, as

Brian:

far as I understand in using them, it, one of the main benefits is that you

Brian:

don't have a bunch of links that you have to click and then hit the back

Brian:

button if you don't get what you want.

Kat:

Yeah, I mean, I think with the way that the preexisting generative AI

Kat:

tools are built, it really is meant to keep you within their product itself.

Kat:

And to your earlier point, it's, it's completely intuitive that that would lead

Kat:

to impact on publisher, publisher traffic.

Kat:

I mean, that's a no-brainer.

Kat:

Scout is designed differently and it's too early to tell how much traffic it's

Kat:

gonna extend down to stream, to cultures.

Kat:

But if you use it, if you put it side by side with one of these other tools, you're

Kat:

gonna see immediately that it's different.

Kat:

It has much bigger citations, it has read more links.

Kat:

It has, it has a, a, a much more visual approach to promoting publisher content.

Kat:

And our hope is that.

Kat:

We can create the right balance of offering that quick synthesis

Kat:

and context together with a pathway into publisher content.

Kat:

and I think that's, I don't think that people wanna live their whole

Kat:

lives in a, in a wall of text.

Kat:

I think that they wanna be able to access and explore the internet

Kat:

and we believe, you know, in the sustainable open web and that there

Kat:

should continue to be vibrant content produced in a lot of different places.

Kat:

And so I think this approach is.

Kat:

A great one for trying to give you, you know, give a user the benefit of

Kat:

some of that synthesis that they can get with these AI tools, but also

Kat:

create that doorway to a deeper.

Kat:

A deeper knowledge.

Kat:

and I think that also contributes to like building trust, right?

Kat:

you are gonna put all your trust in the AI tool, or do you wanna, you wanna verify,

Kat:

you wanna go deeper, you wanna know where that information is coming from.

Kat:

and I think users still have a strong pool toward that, towards knowing and being

Kat:

able to trust, in what they're reading.

Brian:

Yeah.

Brian:

Do you, I mean, you mentioned the open web, like, and I think there's a lot of

Brian:

questions about, about the future of the open web, and I'm wondering, like when

Brian:

you look at, at, at AI broadly, like do you see this as a platform shift on, on.

Brian:

On par really with the move from analog to digital versus even desktop to mobile.

Brian:

Like, I mean, that it's, 'cause I think, I think sometimes it can

Brian:

be hard because there's so much hyperventilating that comes from, from

Brian:

Silicon Valley, like it's happening.

Brian:

The spaceship is over the, the White House is what, my fellow podcast

Brian:

host told me, uh, a while ago.

Brian:

and.

Brian:

I think it, it calls into question just the future of, of the open web, because

Brian:

all of these forces and a lot of money and power seem to be, lined up against

Brian:

it, at least as I define the open web.

Brian:

But I mean, do you think that, like, give me the case that there's, I guess

Brian:

I, I put it multiple questions there.

Brian:

what, what is, like, what is your assessment of how big this

Brian:

shift is going to be with AI for, for publishers in particular?

Kat:

Massive.

Kat:

I think it's gonna be massive.

Kat:

I think it's gonna take some time to play out.

Kat:

I think it's unclear where it leads.

Kat:

I think that we all have to be really experimental and, you know, holding

Kat:

dear that the, the, the principles that we have, that content has

Kat:

value and trusted content matters.

Kat:

And that original facts have to be brought into the world.

Kat:

without some original facts and data being built into the world, generative

Kat:

AI can't do what it's intended to do.

Kat:

So that original piece has value.

Kat:

but I think we have, we are gonna have to navigate a, a very tumultuous

Kat:

time figuring all this out because I don't think, I don't think this,

Kat:

I, I don't think it's over-hyped.

Kat:

I think we can all tell that from the way that we are interacting with.

Kat:

The web and digital products today where we're taking our questions, how

Kat:

we're getting our answers, you know, how memory in these products is fundamentally

Kat:

changing the way we build knowledge.

Kat:

I think it's, it's, it's not going away and it's gonna be really, really

Kat:

massive and momentous and, I think it's really about how we respond to that.

Brian:

Okay, so now the open web question, right?

Brian:

Like, so at first, what is your definition of the open web?

Brian:

I mean, because Yahoo was, you know, I remember when Yahoo was like the

Brian:

enemy of like the open web in some ways 'cause it was portals versus the rest.

Brian:

And, you know, the, the people who were not in the portals were

Brian:

always complaining about the portals getting all of the ad dollars.

Brian:

Those were simpler, Tyler, like, they're only getting, like, they're getting

Brian:

like two thirds of the, the ad budgets.

Brian:

Like, oh, well just wait, just wait to see how this is gonna turn out.

Brian:

what, what is, like, what is the future of the open web?

Brian:

How do you think about it?

Brian:

Because what you're describing with AI seems like an alternative to the open web.

Kat:

I mean, I think of the open web as a place where, you know.

Kat:

Businesses can be built, built and monetized outside of monoliths.

Kat:

and that there can be spaces where from a user perspective, you can explore

Kat:

and discover and find things, that are not simply fed to you by algorithms

Kat:

in a, in a again, monolithic platform.

Kat:

I think that we still are.

Kat:

The platforms do dominate so much of what we do today already.

Kat:

I do think AI creates another, another layer of threat to that sort

Kat:

of open web because, you know, we're just gonna be easier to go to one

Kat:

place and get it all in there versus go to a bunch of different places.

Kat:

But the question to me is how do you create.

Kat:

How do you create that vibrant ecosystem where you still have a lot

Kat:

of people able to create content and build businesses, and how do we build

Kat:

an economy that can support that?

Kat:

It's hard to know what, it's hard to know what the future is gonna hold.

Kat:

but I would love, you know, I hope and believe that in the future there's still

Kat:

gonna be a lot of ways to create value and get, get dollars back for that value.

Kat:

We just.

Brian:

Yeah, I mean, I think, think about what's going on in

Brian:

the software business right now.

Brian:

I was seeing Sam Altman was saying, well, software companies are probably

Brian:

just gonna be API companies, right?

Brian:

And I, I wonder about.

Brian:

A lot of publishing, like whether in this line of thinking, and these

Brian:

are the people who are building the systems and they have all the money and

Brian:

they have the compute, so it matters.

Brian:

What they say is that whether publishers stop in, in, in some cases, like

Brian:

they're, they're becoming API companies.

Brian:

Versus they're, they're running the, all their systems themselves, right?

Brian:

Like, I, I sometimes wonder about that because they've

Brian:

outsourced a lot of functions of the publishing by, by necessity.

Brian:

you know, and so I wonder, does this end up leading to, to publishers

Brian:

saying we are mostly our, most of our business is going to be as

Brian:

like, trusted information suppliers.

Kat:

Yeah, I can definitely imagine a future where there's a lot more emphasis

Kat:

on the production of the information and sale of that information versus how it's

Kat:

presented, how it's presented to users.

Kat:

And by presentation I mean all the web infrastructure, that

Kat:

web or app infrastructure that produces it to a, to a consumer.

Kat:

I think that certainly is.

Kat:

Is a possibility and that's what gives you the ability to laser focus on the audience

Kat:

and what are their information needs.

Kat:

I think that's also why at Yahoo we're really focused, you know, it's like

Kat:

building this contributor platform, like what's a toolkit that, that you can

Kat:

use to build and create this value that you don't have to, you know, maintain

Kat:

all the technology of when the, the overhead of maintaining that technology

Kat:

becomes, you know, becomes an obstacle to doing where you're doing the thing

Kat:

that you're really doing to produce the value, which is producing the content.

Brian:

Yeah, I mean, you were, you were at the post when, when people

Brian:

wanted to sell their CMSs, right?

Brian:

Like, I mean, like there was a lot of publishers.

Brian:

I mean, New York Magazine was out there, clay, I'm like the only

Brian:

person who remembers this outside of anyone at New York Magazine.

Brian:

Then, I mean, they were trying to, you know, sell their, their license,

Brian:

their CMS, and they were, they're gonna be technology companies and, I can

Brian:

definitely see, this developing where a lot of publishers really do just

Brian:

focus on, on producing really great, differentiated content and, and hopefully

Brian:

data products and are able to then have.

Brian:

You know, li big licensing businesses.

Brian:

I don't know if a lot will, like, I think of a look, there's a lot of SEO driven

Brian:

publishers that, are in a really difficult spot and, I think that's, that's reality.

Brian:

I mean that they were supplying, they were kind of suppliers anyway, right?

Brian:

The business model was just, you know, indirect.

Brian:

But yeah, I, I, I wonder whether publish how much publishers are going to build,

Brian:

and that's what I see at, at publishers is they don't know what to build right now.

Brian:

That, that would be what I observe.

Kat:

Yeah, I think that's true, and I think it's essential for

Kat:

all publishers to figure out what are they offering that's unique.

Kat:

Is that the content or is that something in the products?

Kat:

and if it's a product, what is their advantage in

Kat:

building it faster and better?

Kat:

Then a tech company could, and how do they prevent it beco,

Kat:

from becoming Abstractable?

Kat:

Because if it's Abstractable, then why isn't it just content

Kat:

that they're feeding through some API to some other, other place?

Kat:

Right.

Kat:

So I think there's a, there's a lot of questions for publishers right now, but

Kat:

the fundamental unit of most publishing companies is, is content and original ip.

Kat:

And if we can figure out for them how to, how to lean into that and then reduce

Kat:

the overhead of all the other stuff that's not necessarily adding value.

Kat:

you know, moving pixels around on an article page or a

Kat:

homepage or something like that.

Kat:

Right.

Kat:

then I think that could be a good thing.

Kat:

Maybe less distracting for publishers in the long run.

Kat:

but you know, it's gonna take some time to figure out how to get there.

Brian:

Yeah, so final thing is like when you're looking at three years,

Brian:

what does this ecosystem look like?

Kat:

Well, nobody knows what the

Brian:

I used to do five years, but like now I'm down to

Kat:

It's hard to know what the future holds.

Brian:

I will go into 18 months next.

Kat:

pace of change is gonna dramatically accelerate.

Kat:

I mean to the point you were making about just like what AI

Kat:

engineering en enables, the way that it's changing product development

Kat:

engineering is just amazing, right?

Kat:

Just the rise of cloud code over the past few months, this

Kat:

has been incredible to watch.

Kat:

so there's gonna to be a massive velocity shift and I think that's gonna.

Kat:

It's gonna force, you know, force more rapid decision making about what are

Kat:

the content products that have value, from a publisher ecosystem standpoint.

Kat:

and so, you know, we are just thinking about how to support that,

Kat:

how to support that transition, how to be on the front edge of figuring

Kat:

out how to, how to partner and, and how to provide monetization

Kat:

in that environment, et cetera.

Kat:

but I think it's gonna be more, you know, it's gonna be more.

Kat:

Ai, it's gonna be more visual, it's gonna be more social, even than it

Kat:

is today, and that we're gonna be having to move even faster than we

Kat:

are today, by a, by a huge margin.

Brian:

you think publishers will have websites for humans or just for bots?

Kat:

I think they'll still have websites for humans for, for a long time.

Kat:

I mean, it's like the newspaper people are like, oh, newspaper's going away now.

Kat:

Newspaper's still here.

Kat:

It's just different.

Brian:

Eh, not everywhere.

Brian:

Not in Atlanta.

Kat:

but it's a more boutique product.

Kat:

But it's in a lot of places.

Kat:

And some places are starting, starting to produce print additions,

Kat:

even if they're quarterly or

Kat:

whatever.

Kat:

It's more of a prestige products.

Kat:

But, you know, I think in three years, you know, from a Yahoo perspective, the role

Kat:

of guide is gonna be even more important.

Kat:

so like products like Scout or you know, Yahoo Home and the products

Kat:

that we're introducing, it's like, how do we help you get oriented.

Kat:

how do we be the place you start that journey?

Kat:

How do we help you find the good stuff when it's increasingly sort of, mashed

Kat:

into a nameless, faceless thing, right?

Kat:

How do we continue to support that vibrant economy of discovering different

Kat:

things and, and feeding that urge, to, to, to explore and be curious?

Kat:

and so I think that role of guide is gonna continue to be essential.

Brian:

Cool.

Brian:

Well, Kat, I really appreciate you taking the time.

Brian:

It's great to chat.

Kat:

Great to chat with you Brian.

Kat:

Thanks for having me.

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