On Monday, Yahoo announced that television news personality Katie Couric will be its new "Global Anchor" starting in January. Couric's profile is substantially lower now than its heyday -- she hosts a daytime talk show now rather than the CBS evening news -- but she's still a substantial get for the tech company, especially considering what she brings to the table: an established audience on the prowl for video content.
But Couric isn't the only recent hire that appears aimed at attracting engaged eyeballs to video content: Yahoo recently recruited the prolific New York Times tech columnist David Pogue, known not just for his writing, but for his frequent video posts, appearances as a technology commentator for CBS News's "CBS Sunday Morning" and his PBS Nova series.
And there's a pretty compelling reason for Yahoo to be investing in such people: They are established personal brands with a proven track record of bringing in video-content audiences. That's key to Yahoo's efforts to build out its media arm, which is itself key to building its ad revenue.
As it stands now, the company doesn't have enough supply to fulfill the demand for video ads. In fact, Yahoo CEO Marissa Mayer told investors that during a call in July, saying, "Our video inventory sells out months in advance, which is not a good thing." Her solution: "Working hard to drive traffic and video views will make this a primary area of investment over the next year." Part of that campaign is about bringing on personalities such as Pogue and Couric who more or less guarantee those video views.
And that's even more important because consumers are spending more and more of their time online with digital video as online speeds have increased and the quality of video streaming has improved. The most recent Pew Internet & American Life Project data show that 78 percent of adult online visitors watch videos online or download video.
The move to mobile devices feeds into that: A majority of Americans over the age of 16 now own smartphones, and 41 percent of online adults use their phones to watch video. Tablets, which many use to consume video content, have also seen a meteoric rise. While only 3 percent of American adults had a tablet in May of 2010, by June of this year a full third had such a device.
And where customers go, advertisers follow. In August, the advertising research firm eMarketer noted that "video remains the fastest-growing" digital format for advertising -- predicting ad spending in the medium will be up 42 percent in 2013 from 2012. It still pales in comparison with the advertising investment of TV and has a minority share of digital advertising as a whole. But the strong growth and the high cost vs. traditional online ads means that building up video content is a smart move. In that context, Yahoo's investment in bringing talent well-versed in producing popular video content makes perfect sense, even if the company isn't planning to directly compete with TV.