San Francisco — Yahoo Inc. said on Wednesday it would acquire Rivals.com, a site for fans of college and high school teams, bolstering the Internet media company’s place as the top U.S. sports site in audience terms.
Jerry Yang has made his first move as chief executive of Yahoo, buying the college sports website Rivals.com for an undisclosed sum.
Analysts believe Yahoo may be considering more dramatic moves after changing its leadership earlier this week in its latest attempt to revive its sagging stock. Yang took over Yahoo this week after the abrupt exit of predecessor Terry Semel, its CEO of the past six years, raising question marks over the internet firm’s direction.
But after the announcement that Yahoo Inc. had purchased the Web site, Rivals.com officials said they could be entering a new stratosphere.
Besides bringing Yahoo a base of 2 million to 2.5 million fans of high school and college football and basketball, the deal also is a measure of Yahoo’s commitment to its media business following top-level management changes this week.
Yahoo Sports will receive a significant increase in Web hits through Rivals and could threaten ESPN.com’s domination of the online sports world, analysts said.
Rivals is one of the nation’s leading college football and college basketball recruiting sites, receiving more than 2 million hits a month. Its busiest day is college football’s National Signing Day, which promoted 74.3 million Web hits to the site on Feb. 7.
The Web site has about 185,000 subscribers who pay $10 per month or $100 per year. Its revenue comes from subscribers, advertising and e-commerce conducted on the site. In addition to its own reports, the site features a network of fan Web sites for more than 100 colleges and universities.
“The deal makes sense to me and to all of us from the standpoint of the complementary nature of the two companies,” Yahoo Sports Executive Editor Dave Morgan said. “You add Rivals to Yahoo Sports, and it works so well together right out of the gate.”
Rivals.com, which is based in Brentwood, Tennessee, outside of Nashville, has developed an avid base among hardcore sports fans since it was founded in 2001. It operates 105 college team sites and another 48 regional sites for high school fans to track local sports, Rivals Chief Executive Shannon Terry said.
“We are ready to go to the big leagues,” said Bobby Burton, Rivals’ chief operating officer and editor in chief.
It will function as an independent unit in Yahoo Sports, a media site which attracts a monthly audience of 15 million visitors, according to audience measurement firm comScore Inc.
Yahoo Sports, which is advertising-supported but has a sizable subscriber base for its fantasy sports league, recently surpassed the audience of its biggest competitor, ESPN.com, which has about 12.7 million users, comScore says.
For now, the Rivals.com deal will intensify Yahoo’s competition with News Corp. since it already owns Scout.com.
Although Yahoo began negotiating with Rivals.com while Semel was still in command, the acquisition papers were not signed until Yang’s second day as CEO, said Scott Moore, a Yahoo senior vice president who oversees its news division. “Jerry is very excited about it,” Moore said.
Both Rivals.com and Scout.com cater to obsessive sports fans who want to know every detail about their favorite college sports teams. The users of these sites typically are alumni of the colleges, major financial contributors to the athletic programs, or both.
Officials with both companies declined to disclose financial terms of the deal, an indication that the sales price is too small to dent Yahoo’s finances.
Critics of Yahoo have accused it of a lack of innovation and flat footedness in the face of rival Google’s growing ascendancy.
Nevertheless, Yahoo still generates more advertising revenue than any other internet search firm except Google, and has more than 500 million worldwide users.
Yahoo thinks Rivals.com will help fill some gaps in its sports section, Moore said.