NEW YORK (TheStreet) -- Yahoo! (YHOO) tried to appeal to Swifties -- the teenage (and older) army of rabid Taylor Swift fans -- by hosting a live stream event on Monday of Switft introducing her latest single. Sunnyvale, Calif.-based Yahoo! is tiptoeing into original Web content creation and this is just the latest tier in its plan. If successful, this would give Yahoo!'s topline a boost after a series of hits and misses (Tumblr, a blogging platform Yahoo! paid $1.1 billion for, has yet to see significant revenue from advertising).
"The fastest-growing part of the Internet in terms of advertising volume is online video," Brad Adgate, research director at Horizon Media, told TheStreet. "As dollars continue to migrate to online video, you want to have a place at the table."
Digital video ad spending will total $12.27 billion by 2018, according to eMarketer estimates, with the industry growing at 41% this year alone. No wonder Yahoo! wants in.
The problem is this elevator, though still on the ground floor of its growth potential, has already reached maximum capacity. Netflix (NFLX) dominates the online streaming space with Hulu nipping at its heels. Amazon (AMZN) has elbowed its way in with its own original content (though its programming success is a blip compared to Netflix's).
To compete, Yahoo!'s strategy is to adopt broadcasters' game plan -- to focus on the spectacle of the live event, appealing to the cord-cutters' mentality but also eliciting the must-watch-now, can't-miss anticipation broadcast television once represented.