Marissa Mayer, since taking over as CEO of Yahoo, has been working on a plan to make Yahoo into Google, but without the abandonment of its principles. When Marissa was at Google, being one of the early employees, one of her chief responsibilities was to ensure the developers didn't ruin the homepage. She was also responsible for the overall web presence of the brand, ensuring all Google properties felt like Google.
At some point, someone decided that Google didn't need to be Google anymore, and moved her away from the thing that had kept the company consistent and into other positions. It hasn't worked out the way they wanted. Since joining Yahoo she has worked to create a cohesive Yahoo that spans the Internet with relevance and content. With a new logo, older product shut downs, remodel of Tumblr, among many other changes, Yahoo is becoming a new, successful brand.
One of the aspects of the Internet that Yahoo had managed to avoid like a drunk girl at a party is video. There were several meager attempts, but it never felt as if the company was interested in participating with the rest of the Net. Last year, Mayer began the process of fixing that, purchasing Saturday Night Live rights from NBC, available now. They also purchased a live concert streaming service and hired broadcast news star Katie Couric to add credibility to their offerings.
What they are still sorely lacking is user-generated content. Having unsuccessfully tried to acquire Dailymotion, they are still no closer to taking on YouTube, but a YahooTube option is something that the company certainly needs if it is going to continue to compete. With Tumblr the company has text and photo (mostly), but no good platform for video.
One thing that Yahoo will need to do to succeed is to focus on what YouTube has been unable to accomplish: quality. Since being purchased by Google, YouTube's video streaming quality has taken a sharp turn downward, constantly buffering and failing to load videos, and the problem gets worse by the day. If Yahoo can create a video streaming service that actually streams videos, they will be far ahead of YouTube.
Next, they need to focus on the quality of the content. While a user-generated site will always have a little of everything, by guaranteeing that top-creators are able to generate revenue from the platform, they will create more content, therefore drowning out some of the less-desirable videos of drunk texting and high school fights. Instead, getting content like What the Buck and the recently hiatused =3 through revenue sharing are what a YouTube competition from Yahoo must look like.