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Monday 9 December 2019

Yahoo dumps video hub amid 'refocusing' drive

The firm had hoped its video hub would be able to compete with YouTube and Netflix
The firm had hoped its video hub would be able to compete with YouTube and Netflix

Yahoo has pulled the plug on an online video hub that had once been envisioned as the beleaguered company's answer to Netflix and YouTube.

The end of the Yahoo Screen is part of a purge being directed by CEO Marissa Mayer with hopes of generating greater profit elsewhere.

Ms Mayer oversaw an overhaul of Yahoo Screen 16 months ago that came in the form of a new mobile application, thousands of clips from NBC's Saturday Night Live and a wide variety of other popular TV shows.

But Yahoo Screen never attracted the vast audiences that flock to Netflix and YouTube.

Yahoo is now scattering its video across its digital magazines and other services, such as Yahoo Music.

"We're constantly reviewing and iterating on our products as we strive to create the best user experience," the firm said.

Ms Mayer has pledged to jettison technology that fails to justify the amount of money that Yahoo has been investing.

Yahoo telegraphed that its video expansion was faltering in October when it disclosed a 42 million dollar (£28 million) charge to account for original shows, such as Community, that had flopped.

Ms Mayer is expected to provide more details about her latest plans for reorganisation in about three weeks when the California-based company announces its fourth quarter results.

Industry analysts are expecting the steepest decline in Yahoo's revenue, after subtracting ad commissions, since the company lured MS Mayer away from Google to become its CEO three-and-a-half years ago.

Shares of Yahoo have fallen by about 35% since the end of 2014 as the difficulty of reviving company revenue growth has become evident.

This has increased the pressure on Ms Mayer to take more drastic measures. There have even been calls for Yahoo to sell all of its online operations, but the CEO and the company's board have rebuffed those demands to far.

By building a compelling video hub, Ms Mayer had hoped to lure advertising away from Google, whose operations include YouTube, and social networking leader Facebook, which also boasts millions of clips shared by its users.

Yahoo's stock gained 64 cents to 32.04 dollars (£21.70) on Tuesday afternoon.

PA Media

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