Kara Swisher

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Hey, Yahoo: Lloyd Braun Will Eat Lunch in This Town Again

Former Yahoo executive Lloyd Braun and his partner Gail Berman, a former Paramount executive, have struck an online deal with Pepsi, under which the entertainment and marketing arm of the beverage giant will be a “first-look” and have a chance to fund and sponsor original online content the pair produces.


That Hollywood term refers to giving Pepsi Entertainment the first opportunity to be part of any idea the pair develops. Pepsi could then pass on whatever concept it wants to, even though it might still have a financial interest in the content.

Berman, Braun and Pepsi executives would not be specific about the financing agreements between them or other details about the type of content they will be creating, although such material is likely to cost well under a million dollars per project, relatively inexpensive by old-media standards.

But both sides touted the arrangement as a new kind of marketing and entertainment partnership designed to take advantage of trends toward increased interactivity by consumers, especially younger ones.

“We want to create great online content … and also something that is more than a glorified Internet ad at the same time,” said Braun today. “So we’ll work with Pepsi hand-in-hand to bake new kinds of ad solutions right in organically at the earliest possible moment.”

Pepsi officials said the more interactive nature of sites like Facebook and MySpace meant it needed to look for all sorts of different ways to touch consumers, well beyond techniques in place now that still center on click-through banner ads.

“A lot of online content is already developed and ads and marketing are slapped on afterward,” said Russell Weiner, vice president of marketing for colas at Pepsi-Cola North America, whose brands include the flagship Pepsi, as well as Mountain Dew, Aquafina and Sierra Mist. “We want to be part of the DNA of a show from the very beginning.”

What that means is unclear, and both sides said that just creating too-obvious Pepsi tie-ins would not work.

While a lot of other independent producers like Mark Burnett work closely with advertisers from the start, which essentially results in a lot of product placement, Berman and Braun hope to change the way marketing messages are integrated into content and, perhaps more important, how content online will be funded.

So far, that part of the equation has been a vexing one, with no clear “hits” on the Web as yet, except for viral user-generated content on sites like YouTube.

Although many sites pull in big traffic, like the AOL-owned celebrity site TMZ.com, most professionally produced content has had less success. There have been a lot of single successes, like the popular JibJab cartoon satires.

Braun said he had hoped to change that at Yahoo, which once had big plans to enter this arena, capped by Braun’s hiring by former CEO Terry Semel. It did not work out that way for a variety of reasons, including a pullback by Yahoo and shift of resources to search products.

But he did have a good experience with Pepsi with the creation of one popular property on Yahoo, “The 9,” a daily online show about hot entertainment and digital trends. Pepsi is still the site’s sponsor; the 10th link of the day is called the Pepsi 10 and is selected by a user.

Braun said he went right to the beverage company after he left Yahoo and he and Berman formed their Los Angeles-based production company BermanBraun.

While they have both called it a “multiplatform” company and said they wanted to include Internet and film elements, its first deal was with NBC Universal, giving it a first look at content they produce for television.

Berman has long been considered one of the most powerful women in Hollywood, but left her job as president of Paramount in January after a corporate shake-up.

And Braun’s rocky tenure as head of Yahoo’s Media Group ended in February, with Braun leaving the Internet giant without completing the ambitious online entertainment plans he was brought in to shepherd.

Both Berman and Braun, close personal friends, were also longtime competitors–she ran the entertainment arm of the Fox network for five years starting in 2000, while Braun headed ABC’s entertainment efforts until he went to Yahoo in 2004.

Both are longtime hit-makers: Berman is credited with green-lighting shows like “Buffy the Vampire Slayer” and “24,” while Braun is credited with pushing “Lost” onto the air.

After all this big-company experience, both were looking for a new setup, based on the indie-model with a twist.

“We have always seen this as a cross-platform company,” said Berman. “It is sort of a mini-studio, thinking about all the different mediums to create in.”

Berman and Braun said a head of its Internet group will soon be appointed and a digital content studio will be established in Santa Monica, Calif.

Pepsi’s Weiner said he thought Internet content creation and new ad solutions were still in their formative stages, even though his company thinks the Web will increasingly become a way for products to be marketed, well beyond simple ad placement.

He noted he had a good experience with Facebook, for example, when Pepsi did a campaign to let users design can logos, but he cannot yet imagine how it might all develop.

“I don’t even know if there will be ads attached to this content, especially if our brand is integrated well into the show,” he said. “It is so early, no one has really taken a peel off the onion yet.”

An interesting metaphor, given that Braun’s first experience with Yahoo might have been said to produce tears.

He would not comment on his tenure at Yahoo and its inability to leverage its power more effectively in the entertainment space. But he also said that he thinks it is still early in the game for the medium.

“We want to be Internet-centric, but it also has to be good from a pure entertainment perspective, while offering up something fresh to both consumers and advertisers,” he said. “This is not yesterday’s Internet.”

Are you listening, Yahoo?