Yahoo says operators have nothing to fear

Sumner Lemon

Yahoo Inc. is seeking to reassure carriers that it isn't trying to cut them out of the loop with its mobile content services, even as it rolls out new mobile services for customers.

"Yahoo wants to work with operators for an optimized experience," said David Ko, vice president and general manager of Yahoo's mobile and broadband business in Asia, speaking Wednesday at the CommunicAsia Summit.

Mobile operators are increasingly nervous that companies like Yahoo and Google Inc. will go direct to users with mobile content services, using their networks to offer so-called "over-the-top services" that don't give operators a cut of the revenue. These concerns have grown as content companies refine their mobile offerings and look for ways to make them available to users.

During a speech at the CommunicAsia Summit, Ko announced that six Asian operators will use Yahoo's mobile search engine, called oneSearch. They are Globe Telecom in the Philippines, India's Idea Cellular, South Korea's LG Telecom, Maxis Communications in Malaysia, Indonesia's PT Telekomunikasi Selular, and Taiwan Mobile.

These operators, which represent about 100 million subscribers, have agreed to use Yahoo's oneSearch in exchange for a portion of revenue from the mobile search service, Ko said, declining to detail specific terms of the deals. Most of the revenue will come from advertising, he said.

In addition, operators will generate revenue from increased data charges as users access the search engine.

The announcement that six operators will use oneSearch is an important win for Yahoo in Southeast Asia, where cellular-phone penetration rates outstrip the availability of PCs. Yahoo has long been a presence in the region, where its services are widely used. But competition is heating up: Google opened its Singapore office in May, announcing plans to set up an R&D center and expand its business in Southeast Asia.