Internet media giant Yahoo over the past week has shut down many of its user-created chat rooms on concerns that adults were trolling some of them to solicit sex from minors.

The concerns have prompted several big-name advertisers to pull ads off Yahoo’s chat rooms, but analysts doubt this will have much of an impact on the Sunnyvale, California-based outfit, which relies heavily on online advertising for revenue.

Although Yahoo has pulled the plug on chat rooms created by users, it has left open many launched by the company. Yahoo has also disabled a feature allowing users to create new chat rooms.

Mary Osako, a Yahoo spokesperson, said the company was working on improvements to enhance the user experience, but declined to comment further. Ms. Osako did not say when Yahoo might reopen them.

The trouble for Yahoo started after an investigation by KPRC, a television station in Houston, Texas, revealed last month that some user-created chat rooms on Yahoo were possibly being used by adults targeting children for sex. Chat rooms listed under “Education” carried titles like “Girls 13 And Under For Older Guys," according to the station.

Houston, Texas

Yahoo does not monitor its chat rooms but encourages users to report any content that may be objectionable or may violate its terms of usage. At any point in time, chat rooms can number in the thousands, with an even greater number of conversations taking place in them.   

   

Pepsi and State Farm are among several big-name advertisers including Georgia-Pacific that took their ads off chat rooms after hearing about the report.

“We don’t want to appear on areas that have what large parts of society consider despicable behavior, like the pedophile sites cited on Houston TV,” said Phil Supple, a State Farm spokesperson. “That’s not what we want in our marketing plan.”

State Farm continues to advertise with Internet companies, including Yahoo, but not on any chat rooms, he said.

Online advertising has been a crucial factor in Yahoo’s growth over the past few years. In its most recent quarter, the search giant’s net income doubled to $204.56 million on revenue that more than doubled to $1.17 billion.

Its various sites collectively drew 423.5 million visitors in May 2005, make Yahoo the world’s most popular online property, according to comScore Media Metrix, a firm that tracks web site usage.

But the decrease of ad dollars in chat rooms shouldn’t significantly dent Yahoo’s income statement, analysts say. Yahoo didn’t sell the kind of advertising on these sites that could fetch high prices, primarily because they weren’t targeted ads and didn’t contain video or audio, Jupiter analyst Gary Stein said.

“It won’t be a humungous hit,” said Mr. Stein. “Although people spend a lot of time in chat rooms, they’re not really interacting with ads. They won’t decide to shop for a DVD player in the middle of a chat.”

Yahoo got slapped with a lawsuit on similar grounds earlier this year. In May, a $10 million lawsuit was filed in the U.S. District Court for the Eastern District of Texas against the company and Mark Bates, who moderated a site through Yahoo Groups that shared child pornography.