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Yahoo purchases Associated Content

Posted by Sara | Marketing | Friday 21 May 2010 4:05 am
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Yahoo purchases Associated ContentYahoo Inc. is purchasing Associated Content, a freelance news site, in a deal that is expected to add a folksy touch to Yahoo, which is one of the world’s most successful websites.

Associated Content, launched in 2005, has developed an economical news model that is dependent upon nearly 380,000 freelancers sharing their expertise on varying subjects.

From Livemint.com:

Yahoo plans to sprinkle Associated Content’s contributions throughout its news, sports, finance and entertainment sections. Yahoo will continue to publish stories that it gets from newspapers, its own editorial staff and outlets that include The Associated Press.

Associated Content “gives us more local gravitas,” Yahoo CEO Carol Bartz said in a Tuesday interview.

By providing more parochial stories, Yahoo hopes to widen its audience and create more opportunities to sell online ads tied to the neighborhoods or topics that Associated Content’s freelancers are covering. Yahoo has been slumping for most of the past four years because it has been losing online ad revenue to rivals such as Google Inc. and Facebook.

Yahoo’s decision to expand the breadth of its local coverage is similar to a strategy being pursued by AOL Inc. as its CEO, Tim Armstrong, tries to turn around that company.

AOL is trying to build two low-cost local news sites, Seed.com and Patch.com.

Armstrong stands to personally profit from Associated Content’s sale because he is among the startup’s early investors and even served as its chairman until two years ago. He helped fund Associated Content while he was still a top advertising executive at Google.

Yahoo is planning to close website of Associated Content after completing the acquisition in the third quarter.

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