What is astonishing about omg and Wonderwall's success is the lack of any aspiration to break news, while focusing on glossy, magazine-like packaging and photos.
"I think omg is great for what they do. It's different from what we do. We break stories," said Harvey Levin, executive producer of TMZ. "You shouldn't be reliant on another place for getting all your traffic .... It's just better business."
Levin said his reporters try to ferret out court documents, produce original video clips and obtain exclusive information.
Major breaks have included the anti-Semitic tirade by actor Mel Gibson during a drunk-driving arrest and racist epithets Michael Richards hurled at hecklers at a West Hollywood comedy club. TMZ also broke the news of Jackson's death more than a half-hour before traditional news organizations.
In the fight for attention and Internet advertising dollars, Pitaro makes no excuses.
"If you consider our competitors who have siblings that are TV broadcasters, they get tons of promotion on air," Pitaro said. "We're differentiating ourselves by striking the right tone and aggregating the best content on the Web."
Although the page view count at omg, Wonderwall and other entertainment sites is staggering, revenue is likely to be fairly small (Yahoo doesn't break out figures for omg).
Companies pay roughly $10 or more for every 1,000 people who look at a Web page with their advertisement displayed. With 321 million pages viewed in May, that's an estimated $3.2 million in ad revenue - more than enough to cover five salaries, but peanuts for Yahoo, which averaged about $600 million in monthly revenue last year.
Online entertainment news is also getting more crowded with well-financed players. Along with Wonderwall, February saw the launch of DailyFill from News Corp., though there are no plans so far to link it to the company's traffic behemoth, MySpace.
Pitaro said the company intends to keep a tight rein on costs, while focusing blogs or videos on topics that Yahoo knows its users are interested in, based on the most popular search terms, which are usually about celebrities.
He said he's not scared of the new competition, either, even from sites that have mimicked omg's photo-centric navigation page.
"We love the idea that others are investing in the space, because together we'll all be generating buzz and interest in this arena," he said. "But hopefully we'll all grow."
A service of YellowBrix, Inc.
