Adobe and Yahoo said they will offer a service to let publishers run advertisements inside Adobe's popular document reading software format. Ads for Adobe PDF Powered by Yahoo, as the new service is known, presents publishers with an alternative to conventional subscriptions, which, if widely adopted, could open up a new model based on free, ad-supported publishing.

The service allows publishers to generate revenue by including text-based ads linked to the specific content of an Adobe PDF page. The advertisements can only run in a side panel separated from the publication's actual content.

The service is set to begin public testing, the two companies said on Wednesday. An earlier private test included technology and professional publishers IDG InfoWorld, Wired, Pearson's Pearson Education unit, Meredith Corp and Reed Elsevier NV. The free service requires no special software and is open to United States publishers of English language content, initially.

Publishers who join Yahoo's online advertising network get access to the Internet company's extensive network of advertisers based on the subject matter of their content.

Advertisers gain a distribution channel that can reach highly specific audiences based on their reading interests while allowing them to track how specific ads perform. The approach is akin to how Web-based, pay-per-click ads now work.

From an advertiser point of view this looks like an extension of our existing marketplace. For consumers, the text-based ads are discreetly displayed in a panel adjacent to the published content with no moving or flashing elements so that they do not distract the reader as some Web advertising is known to do. Each time the PDF content is viewed, targeted ads are dynamically matched by Yahoo to the content of the document.

The publisher receives anonymised reports about which ads ran alongside which published content.

In terms of relevance to advertisers, such ads could rank above conventional Web-page banner ads in terms of targeting capacity, but somewhere short of highly specific keyword-based Web ads.

Publishers who register for the service simply need to upload their Adobe PDF-ready materials so that they can be ad-enabled. The content owner then distributes the PDF in any of a variety of ways, including over e-mail or via the Web. - REUTERS