Yahoo!7 alliance eyes AFL net rights
John Lehmann
The Australian
January 31, 2006
THE new online partnership between Kerry Stokes's Seven Network and Yahoo will consider bidding for the AFL internet rights this year if the football code does not strike a new deal with Telstra.
The AFL is talking with Telstra, which holds the rights to an exclusive negotiating period as part of its existing $5 million a year contract over internet and mobile telephone rights.
If a deal is not reached by the end of March, the AFL will open discussions with other internet and telephony players.
Industry sources predict the AFL's internet and mobile wireless communications rights could be worth at least $20 million a year over a five-year period, beginning in 2007.
Seven director Ryan Stokes, who yesterday launched the new website (
www.Yahoo7.com.au), said the new 50-50 joint venture was likely to be interested in the AFL rights.
"At some point that's something that we'd be naturally inclined to investigate - it clearly depends on Telstra's relationship with the AFL," Mr Stokes said.
The new company, called Yahoo!7, comes after James Packer's Publishing & Broadcasting developed a successful online portal, ninemsn, in a joint venture with Microsoft.
Seven will tip $10 million in matching capital into the new business, along with promotions on air and through its Pacific Magazines subsidiary.
Also in the mix is a call option over the network's 33 per cent stake in the M.Net mobile content distribution business.
Yahoo's senior vice-president of international operations, John Marcom, indicated that Yahoo!7 would look to build a digital alliance with a telecommunications carrier.
"We continue to have that kind of conversation with lots of different people all the time and certainly if that comes about I think we'd certainly be a more powerful partner that we otherwise would have been," said Mr Marcom, who will chair a six-person Yahoo!7 board.
"The telephony landscape is going to change very quickly as voice, and IP communications converge."
He declined to outline the venture's advertising revenue targets.
Mr Stokes said he expected the online alliance to expand audiences for Seven's broadcast and magazine content, rather than cannibalising them.
"It's extending the experience, and ... if the audience is moving that way, we would rather be there to capture them," he said.
An advertising campaign will be launched next Monday.
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