ABC and Yahoo are Friends with Benefits

These days almost every media company is looking for a way to blend traditional and new media content providers. The problem, says Ronn Torossian, is that some competitive companies don’t have the luxury of both. This has led to some interesting corporate partnerships and strategic cases of strange media bedfellows. The latest pair of media brands to renew their vows? ABC News and Yahoo.

The two companies, which admittedly have some overlapping revenue streams, recently expanded a web traffic-sharing agreement that dates back to 2011. Why would Disney/ABC share its ‘net domain with digital content powerhouse Yahoo? Cross promotion, for a start. Disney/ABC is a master at cross promotion and recognized fertile opportunities on Yahoo’s site. That’s a given, sure, but what does Yahoo get out of the deal? TV time. CNN is reporting that the head of its new “Digital Magazine” will get some air time on ABC’s massive and perennial ratings engine, Good Morning America.

This agreement is a stark lesson in how two companies with overlapping income streams can work together to mutual benefit, even when some of their content is in direct competition. Both ABC and Yahoo have web news divisions. However, online, Yahoo generates more traffic and captures more name recognition than ABC news properties. On the flip side, ABC had TV, a venue in which Yahoo is not yet a strong player. The agreement works because the benefit for both is cross promotion. Neither entity has to cede any ground and both benefit from legitimate advertising opportunities in areas where they currently lack representation.

While it’s fair to say this “partnership” may not happen without the massive market presence from Fox on TV and Google online, ABC and Yahoo have clearly embraced that age-old truism: The enemy of my enemy is my friend. When it comes to fighting giants, pettier squabbles can wait.

Ronn Torossian is the CEO of 5W Public Relations and founder of the Ronn Torossian Foundation.