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Now Semel, 62, wants to take the next leap, building the mythical bridge between the Internet and the entertainment world by putting Yahoo!'s stamp on everything from music to movies. The ultimate tool: streaming video, which allows websites to deliver content--from movies and TV shows to live news footage, celebrity interview clips and even three-dimensional representations of new cars with simulated test drives. In addition to The Apprentice, Yahoo! already streams regular clips from Entertainment Tonight, and has done a deal to webcast the first episode of Kirstie Alley's Fat Actress later this month. It will also distribute short films by JibJab, the political-satire animation company that gained national attention with its humorous take on the 2004 elections, and has agreed on another cross-promotional deal with Burnett for his newest reality show, The Contender.
Yahoo! is not the only engine searching for the content holy grail. The other major Internet companies--Google, AOL and MSN--all have their own strategies to capture more eyeballs for their sites. AOL (which, like this magazine, is owned by Time Warner) has worked with shows like Big Brother and Who Wants to Be a Millionaire? on advertising cross-promotions and last month announced it was talking to TV production houses about developing its own online content. Microsoft, though slower to embrace Hollywood, is putting its Encarta encyclopedia on its search site. Even Google, which says it is committed to search, last month launched a service allowing users to look up movies, find local screen times and link to reviews.
But Semel may be ideally suited to bringing Silicon Valley and Hollywoodtogether. Soft-spoken and unassuming, Semel, along with fellow former Warner Bros. co- chairman Bob Daly, is credited with helping expand Warner Bros. into a highly profitable business, in part by ratcheting up movie-related merchandising and overseeing hits like ER and Friends on TV and movies like Batman, Chariots of Fire and The Matrix. He carefully maintains the connections he made at Warner, and though he now works out of Yahoo!'s Sunnyvale, Calif., headquarters in Silicon Valley during the week, his home is in Bel Air, where he flies every Friday evening to spend weekends with his family.
Semel's previous effort to put video online didn't fare well. In 2003 Yahoo! offered a service called Platinum, with a mix of ABC News, National Geographic and sports from CBS, for $9.95 a month. Consumer interest was so low that Platinum folded before the year was out. This time, Semel is sticking to an advertising-only model, at least for now. "Our primary business is advertising," he notes. "If we have the largest audience in the world, why won't that be a good business?"
But Apple's iTunes store has shown that it is possible to make money with paid online distribution of content. In fact, Semel bought San Diego--based online music-subscription service Musicmatch last fall for $160 million and will soon launch a new digital music store of his own, possibly by the end of this month.