) has signed another multi-year digital radio deal with Clear
Channel expanding on its strategy of striking content-sharing deals
with traditional media brands. The financial terms of the deal were
Clear Channel is the biggest player in U.S. terrestrial radio, with
a reach of more than 237 million monthly users in 150 markets.
Clear Channel's iHeartRadio boasts of a monthly audience of about
45 million and offers live digital feeds to more than 1,000 radio
Per the deal, Yahoo will use Clear Channel's iHeartRadio platform
as its official digital radio service. Both Yahoo and Clear Channel
content will be cross-promoted on iHeartRadio.com, local radio
station websites, Yahoo! media network, and other Yahoo properties,
including its entertainment sites such as Yahoo movies, music and
The deal will also include partnering on live events. Yahoo will
carry nearly a dozen live Clear Channel events annually as well as
live video from this year's iHeartRadio Music Festival in Las
The partnership is expected to benefit both companies over the long
term through deeper user engagement. Clear Channel will be able to
expand its user base through a digital media giant that serves 167
million unique users a month, according to comScore.
Good content is vital for a company serving ads, because the number
of users it attracts to its properties is directly proportional to
the ad revenue it generates. We believe that Yahoo! will continue
to pursue this kind of content sharing deal in order to boost its
online user base going forward.
Earlier this week, Yahoo's agreement with European music
streaming service Spotify was made for the same purpose. Already,
the company has a number of content sharing deals with other
companies including CNBC, and
) ABC Television Group.
These continued partnerships could be part of Yahoo's drive to
focus on areas other than its search business. As the company has
virtually bowed out of the search market, we believe that it is
looking to protect its share in the display and video ad market.
Yahoo has lost almost 65% of its value since its 2006 peak and has
been struggling to improve its financials and build shareholder
confidence. But the company has failed to turn around and is facing
management turmoil following the recent dismissal of its third CEO
in just three years.
However, the company's first quarter non-GAAP earnings beat the
Zacks Consensus Estimate by 8 cents. The 22.3% sequential increase
and 5.1% year-over-year decline were better than what most
investors were expecting.
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The company is fighting the likes of
). However, despite its struggles in the recent past, partnerships
of this sort are likely to boost investor sentiment.
Currently, Yahoo has a Zacks #3 Rank, implying a short-term Hold