Yahoo Buys Associated Content for $100 Million

Yahoo on Tuesday announced that it would acquire Associated Content for slightly more than $100 million, firing a shot across the bow of AOL and Demand Media in the race for content.

"Combining our world-class editorial team with Associated Content's makes this a game-changer," CEO Carol Bartz said in a statement. Image: Flickr / Yahoo

Yahoo on Tuesday announced that it would acquire freelance news agency Associated Content for slightly more than $100 million, firing a shot across the bow of AOL and Demand Media in the race for content.

The deal, which will be announced later today, is part of an effort to shore up Yahoo’s content offerings and underscores the increased use of low-cost, crowd-sourced content, a strategy that AOL is pursuing through its SEED content factory, as well as Demand Media, which reportedly hired Goldman Sachs to explore a summer IPO.

News site Associated Content is in the business of generating lots of content produced by freelancers that can earn as little as $5 a story.

Associated Content, backed by AOL CEO Tim Armstrong, as well as VC firms Canaan Partners and Softbank Capital had raised $21 million in venture funding. AOL had been seen as a likely buyer, but instead it launched SEED and Associated hired Allen & Company to beat the bushes for other prospective buyers late last year.

Associated Content CEO Patrick Keane is expected to join Yahoo in the wake of the deal, and may take the top sales job vacated by Joanne Bradford, who left the company to join Demand Media in March. Mr. Keane, a veteran of CBS Interactive and Google, declined to comment.

“Combining our world-class editorial team with Associated Content’s makes this a game-changer,” CEO Carol Bartz said in a statement. “Together, we’ll create more content around what we know our users care about, and open up new and creative avenues for advertisers to engage with consumers across our network.”

Associated Press Logo

Founded by Luke Beatty in 2004 Associated Content receives more than 16 million unique users per month, according to comScore, and the editorial staff reviews more than 50,000 pieces of content per month, according to the company.

Associated manages a network of freelancers, but also built underlying technology that predicts what kinds of content consumers want, as well as surfacing that content through natural search on engines like Google, Yahoo and Microsoft’s Bing so the library makes money over time.

Associated has also signed deals with major media publishers, such as Reuters, Cox Newspapers, Hachette Filipacchi and USA Today as they look for low-cost content beyond news to serve their audiences.

Associated claims 380,000 contributors writing on a range of topics, from retirement planning, to dealing with pregnancy neck pain to bugs.

The deal signals a new approach to content for Yahoo, which tried an expensive, Hollywood-style approach under former studio boss Terry Semel, but have since dialed back those efforts to low-cost production of content such as Yahoo Sports and OMG, its entertainment-focused site. [Image: Flickr/Yahoo; via Business Insider and Mashable]

Share this article

We welcome comments that advance the story directly or with relevant tangential information. We try to block comments that use offensive language, all capital letters or appear to be spam, and we review comments frequently to ensure they meet our standards. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Coinspeaker Ltd.