Google’s Froogle Ramps Up on Local

Google’s Froogle has been an also-ran among the giant comparative shopping sites, being out-distanced by the likes of eBay’s Shopping.com and Scripps’ Shopzilla. Indeed, Google’s apparent inattention to Froogle has been a mystery.

But this week, Google turned on the burners for Froogle. It announced that it will provide sales-and-inventory search programs for big box and local merchant retailers with ShopLocal, and StepUp, a Bay Area startup that now provides online inventory search for 1,200 retailers in 8,000 locations. Roughly 75 percent of StepUp’s merchant base, or 900 retailers, come from outside the Bay Area. StepUp also has 250 Bay Area specialty retailers, grandfathered from its acquisition of MarketSquare.

The Froogle announcement is actually the first concrete manifestation of GoogleBase, a do-it-yourself classifieds and Yellow Pages builder. While few details of GoogleBase have been released, its mere existence has caused some consternation with local media and commerce companies, who now finally understand that they’ll be directly competing with Google.

Online Newspapers See 11% User Growth

The transition for newspapers from print to online is incomplete, and possibly unsuccessful. But online newspapers have definitely gained momentum, with usage up 11 percent from last year, according to Nielsen/NetRatings. At the same time, the Audit Bureau of Circulation reports that print circulation dropped about 2 points.

Nielsen VP of Analytics Charles Buchwalter told The Local Onliner that one driver of newspaper sites, and other news sites, is the rise of RSS news feeds. The ability to add newspaper feeds means that people are accessing more newspapers, more often, said Buchwalter – even though RSS has “not penetrated significantly” at this point.

Beside RSS, another reason for the jump in usage is that people are accessing newspaper websites from several computers – although Nielsen tries to count them as one user, said Buchwalter. “It’s a tremendous part of it.” A third reason is that many newspapers are simply doing a better job of driving traffic – and getting credit for it. “The Washington Post is doing a very good job with their data analytics and their continuity links,” he said. More details follow.

Newspapers and Disruptive Technology, Circa 2005

Shareholder cries to break up or sell Knight Ridder begs the question, once again, of where newspapers are in Clayton Christensen’s “disruptive technology” cycle. Are they still facing the beginning of disruption, where newcomers are focused on new audiences that newspapers don’t care to reach? Or are they in the middle of disruption, where those newcomers have begun to repackage their products so they compete more directly with newspapers? Or more disastrously, are they at the end of disruption, where newspapers are much on the defensive that they cannot win, even in their traditional markets?

Harvard Business School Professor Clark Gilbert worked under Christensen at Harvard, and has made media disruption a specialty of his own. In a Nov. 8 Manager’s Journal Column in The Wall Street Journal, written with Innosight’s Scott Anthony, the suggestion is that newspapers are probably in the middle of disruption – a stage in which it is not too late to remake themselves for the future. Gilbert and Anthony also suggest that newspapers have been moving in the right direction with a stream of acquisitions that specifically address new audiences, including Careerbuilder, About.com, Slate, MarketWatch, MySpace.com and Topix.

Gilbert and Anthony say it is too early to definitively assert how successful newspapers will be in their efforts not just to turn back the clock, but reach new audiences. But the acquisitions that newspapers have made “appear promising. Not only do these companies have large audiences. They provide newspapers with new business models and access to segments where online brokers are actively participating.”

Broadcast Interactive Evangelizes for TV Websites

It’s no surprise that TV station websites remain underwhelming in most markets. They still think of the Web as a promotional platform. But since 2003, a number of stations have begun to remake themselves, leveraging their local presence with content and advertising. Some are making a dent in the local advertising market, with earnings running from $300,000 to over $1 million in larger markets.

Station groups like Clear Channel are doing it on their own. Most, however, have signed partnerships with TV website specialists, whose ranks include WorldNow, with 147 stations; Internet Broadcasting Systems, which has 70 stations, including many top markets; and relative newcomer Broadcast Interactive Media. Broadcast Interactive will have 70 stations by the end of the year, but mostly in smaller markets – the disadvantage, perhaps, of starting after WorldNow and IBS.

BIM Chief Timur Yarnall shared his sense of where the marketplace is going with The Local Onliner. The best situations for TV Websites are when they go local and create new revenues from new customers, rather than bundling in existing contracts with car dealers and other traditional TV advertisers, says Yarnall. Homebuilders, real estate brokers and mortgage advertisers are examples of new customers who haven’t previously worked with TV stations. “The website clinches it. Otherwise, these guys would not have gone near TV.” More from our discussion is below.

Shareholders to Knight Ridder: Sell or Else!

Knight Ridder may not be the best managed company, or a great place to work. But can another media company do a better job of leveraging its 29 newspapers? This is the assumption behind a challenge by two major shareholders, who want to get rid of 65-year-old Chairman Tony Ridder and either sell the company off to the highest bidder, or break it up.

Legg Mason’s Private Capital Management (PCM), which owns 19 percent of the company, complains in a letter to the board that Knight Ridder is underperforming, even compared to the rest of the newspaper industry. According to PCM, the company has failed to deal with “continuing consolidation among traditional sources of print advertising revenue; the redirection of advertising dollars to other media; its unexceptional operating margins; and its lack of a nationally read paper capable of being leveraged in the online market.” PCM’s complaint has been joined by Harris Associates, which owns 9 percent. Tony Ridder, meanwhile, holds just 1.9 percent.

The specter of a possible bidding war for Knight Ridder has caused the company’s battered stock to do a quick jump. But one assumes that PCM and Harris’ complaints are about more than just a short-term stock boost. The question is why PCM thinks that other newspaper companies would achieve better results.

Gannett Unveils ‘PaperBoy’ Online Circular

Retailers are sick of being lost amidst the clutter of newspaper print circulars. They haven’t seen much usage from their online circulars, either. But they’ll look on with interest come January, when Gannett, Knight Ridder and Tribune begin testing an online circular that allows a banner ad to be “moused over” to provide advertiser specials, store locations and other information.

At least 217 of the 245 newspapers in the Gannett, Knight Ridder and Tribune consortium have given a green light to the test, as well as Yahoo. Additional joiners from Knight Ridder’s Real Cities network are likely.

The mouse-over circular technology, branded as”PaperBoy,” is being provided by PointRoll, which was purchased by Gannett earlier this year for the heady sum of $100 million. Conceptually, PaperBoy might be seen as the other side of iPix AdMission’s SpotLight ads, which enable users to open searchable libraries of real estate or auto photos when banners are moused over.

TorStar Goes With LiveDeal for Local Auctions

For a short time, eBay experimented with a Local Trading unit, which specialized in autos, sofas and other things “too heavy to ship.” But in 2001, it closed down the unit, which didn’t fit into its plans for eBay Autos, greater transaction fees, etc. By doing so, eBay took the chance that it would be left vulnerable to competitors filling the void.

Sure enough, jump to 2005, and a flurry of companies are ready to take advantage of the increasingly clear relationship between local auctions, classifieds and transactions. One of them is Santa Clara-based LiveDeal.

Launched by a former eBay engineer in 2003, the 25-person company lists 200,000 items for sale every day, and gets about 500,000 unique viewers a month. LiveDeal’s big news this month is that it has landed $4.8 million in financing, including $3 million from TorStar, the progressive publisher of The Toronto Star and dozens of smaller community and daily papers in Ontario. Other investors in this round include Draper Richards, a VC firm, and individual Silicon Valley investors.

We had the opportunity to talk with Vice President of Development Steve Harmon about the company’s progress. Details from the conversation, and more background, continues below.