Yahoo 2001 Annual Report Download - page 9

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Going broadband with a bang
Leading Internet sites have long reported an interesting trend. During the workweek, usage frequently spikes
during the lunch hour, as employees use the time to access the Web via broadband connections at work.
There’s no mystery to the phenomenon. As the Internet experience has expanded, so has the demand for
broadband access to take advantage of rich media and enhanced interactive services. In fact, according to
Nielsen// Net Ratings, high-speed Internet connections accounted for more than half of all time spent online in
January 2002, the first time broadband use exceeded dial-up access.
In popular business-speak, high-speed Internet access has reached a “tipping point.” The same hunger
that drove rapid acceptance of business broadband is now compelling consumers to demand the same quality
of service at home. It is Yahoo!’s aim to be one of the driving forces in this transformation, helping broadband
providers turn a long-time promise into long-term profits.
The nation’s No. 1 DSL provider. In November 2001, we announced the first of our initiatives to enter the broad-
band access market through a strategic alliance with SBC Communications Inc., the nation’s leading DSL
Internet provider. In 2002, Yahoo! and SBC will launch for-pay, co-branded DSL and dial-up Internet services for
consumers and small businesses in SBC’s 13-state region (for DSL customers) and nationally (for dial-up cus-
tomers), which includes 25 million DSL-capable locations.
The first-of-its-kind broadband service will be driven by a new, for-pay version of Yahoo!, designed specifi-
cally to enhance and enrich the high-speed Internet experience. Users will be able to personalize the service to
their own needs through a variety of standard and for-pay features.
New monthly revenue stream. Based on our agreement, SBC will market the new co-branded user experience
to SBC’s retail DSL customers on an exclusive basis, and SBC will pay Yahoo! a monthly fee for each subscriber.
In addition, it provides us with an excellent opportunity to “bundle” and market for-pay Yahoo! consumer and
business services, creating another important opportunity for recurring revenues. SBC will market the new
service to new and existing customers, enabling us to leverage the communications giant’s sales and opera-
tions infrastructure.
Our relationship with SBC has the potential to create a significant new revenue stream, beginning in the
second half of 2002. We will also continue to seek additional partnerships with other leading high-speed
Internet providers to increase our broadband footprint.
Grant Winfrey
Senior Director of Marketing
at the SBC Internet Services Network Reliability Center,
showcasing the SBC Yahoo! Dial-up Internet Service
Access:
SBC alliance creates fast track
to new revenue streams.
Through our alliance with SBC Communications, we’re developing an exciting new Yahoo! experience to enhance high-speed Internet
access. Not only will the new product generate recurring, monthly revenues from subscriptions, but it will provide us with a platform to
launch new for-pay services to meet the growing demands of broadband users.