Yahoo! Pulls Porn from Network in Abrupt Turnaround

Yahoo! (Nasdaq: YHOO) said Friday that it is removing pornographic material from its shopping, auction and classified sections, namely adult-related videos and DVDs being sold by merchants on the giant portal.

The announcement came three days after Yahoo! confirmed that it was venturing further into the tainted but extremely lucrative world of online pornography sales. As the news spread that Yahoo! was offering a controlled-entry adult store on its network, the portal faced a barrage of questions and criticism.

The online store was going to sell hardcore pornographic video tapes and DVDs, from which Yahoo! was going to earn a share of the sales.

“We value the strong relationships we have with our members and have consistently listened to them,” Yahoo! president and chief operating officer Jeff Mallett said. “While Yahoo! has offered controlled access to adult products available via the Internet since launching our commerce services more than two years ago, many of our users voiced concerns this week about some of the products sold by merchants on Yahoo! Shopping. We heard them and swiftly responded.”

Adult Ads To Go

Yahoo! also said that it will no longer enter into new contracts for pornography-related banner advertisements on the Yahoo! network. The changes will be completed over the next few weeks, Yahoo! said.

Yahoo! officials had issued a statement Tuesday confirming that “under stringent control, adult products have been available through Yahoo! Shopping for more than two years.”

The company has sold a small number of pornographic videos in the past, and has served as a directory for those who wanted to view pornography.

Risky Business

When the decision to open an adult storefront was announced, Gartner research director Whit Andrews told E-Commerce Times that the move would increase Yahoo’s exposure to protest or outrage and was “a substantial risk.”

Andrews said at the time that Yahoo! was putting itself in the position of having its major advertisers pointing fingers and saying “Hey, I’m putting wholesome ads on your network. How dare you sell pornography?”

Crew Cuts

The last few days have been busy ones for the Internet giant. After the markets closed Wednesday, Yahoo! said that it had met its own scaled-down expectations for the first quarter of 2001, but planned to lay off 12 percent of its workforce. The company also said that it expected a loss for the second quarter.

The layoffs will affect approximately 420 of Yahoo’s 3,510 employees.

When announcing the job cuts, Yahoo! chairman and chief executive officer Tim Koogle said, “We made some decisions that were difficult, but which ultimately balance the investment in our growth areas with the adjustments to our near-term business plan.”

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