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.

Cox Search Launches Kudzu

Cox Enterprises has been largely silent on the local front since the high profile failure of Cox Interactive Media and its city guides in 2001. But the local media giant is quietly re-entering the local waters with the creation of a new “Cox Search LLC” division, described as “a strategy and development group created to develop interactive products.”

Cox Search’s first product is an Internet Yellow Pages/social network named “Kudzu,” after the invasive vine spreading over the southeast. Kudzu was set in motion in October 2003 and formally launched in August 2005, after months of delays. Kudzu’s pilot is set in Atlanta, Cox’s home base, and covers the entire Atlanta metropolitan area, rather than just focusing on the urban center, as Craig’s List tends to do.

A quick look at the site reveals a full-featured, highly searchable product, with 100,000 + local service listings and more than 13,000 user reviews (some motivated by the promise of a $10 gas card in return for 10 reviews). Like a good IYP, users can search by keyword or category, as well by distance or review. The site also features a number of “how to choose” guides.

We had an email exchange with Cox Search Vice President and General Manager Tom Bates. Highlights of the exchange, and additional background, are below.

Alternative Weekly Giants Merge

Alternative Weeklies have seen better days, but the two largest companies, New Times Media and Village Voice Media, will try to rescue what’s left and combine forces in a move that will give them entry into 16 key markets, and 25 percent of the country’s 7.6 million alternative weekly readers. A key rationale behind the merger is the chance to supercharge, the Craigs List-like, free classifieds service from New Times.

Village Voice Media brings six markets to the table, including New York, Los Angeles, Orange County, Seattle, Minneapolis/St. Paul and Nashville. New Times publishes in 11 markets, including Phoenix, Cleveland, Houston, San Francisco, Miami and Dallas.

Tellingly, online’s a key driver of the deal. Voice CEO David Schneiderman is slated to take charge of the company’s online operations, with a focus on, New Times’ Craig’s list-like free classifieds service. The service may be rebranded as “The Village Voice” or some aspect of the title.

To a kultur meister, The Village Voice no longer “matters.” And The Voice, and similar alternative papers around the country, can hardly promise a lock on its traditional “alternative” readers, including college, college grad, gay and minority readers. Still, the alternative weeklies retain large readerships in key markets. Someone is surely picking up the 250,000 copies a week that The Voice puts out.

The Boston Globe Stakes Out a Role in WiFi

The Boston Globe is building out a series of local WiFi “Pulse Points” that provide hyper-local information about the signal area (train stations, book stores, etc.). The paper, which is owned by The New York Times Co., launched two Pulse Points at the end of September, and expects to add some other Pulse Points by the end of the year.

While the Pulse Points only include content today, it doesn’t strain the imagination to see that advertising and transactions could be added in the future. Such a scenario is especially interesting in light of the breezy assumption that Google’s current bid to WiFi all of San Francisco is a slam dunk to sell advertising at the expense of local newspapers, Yellow Pages or TV stations –or all three.

Going forward, the question is whether The Globe and other papers can carve out a role for themselves if the likes of Google assume the hosting responsibilities for WiFi – and presumably, the default browser. We know this: to date, no newspaper has really developed a compelling wireless service worth paying for. Why would they be able to create a more compelling wireless service?

Oodle Loses Craig’s List

Oodle, which aggregates classifieds in 42 cities, has been asked by Craig’s List to stop using it as a source. Craig’s List represents about 20 percent of the company’s 4.5 million listings. To date, Craig’s List has received about one million referrals from Oodle.

Oodle founder and CEO Craig Donato told The Local Onliner that Craig’s List felt there were “server overload” issues, because Oodle sends traffic directly back to the source when an ad is clicked on. “We have a very, very large index,” said Donato.

Donato said that “fixes” were in store, and hopes that Craig’s List reconsiders. Oodle has sought to develop a reputation as being publisher-friendly, and works very well with newspapers, for instance, Donato said. Rather than cannibalize traffic, “we only show enough information” to get people to click through to the originating site.

Insider Pages Bets It All on Pay-Per-Call

InsiderPages, IdeaLabs’ women-oriented social network that collects user-generated reviews for local businesses, says it now has “thousands of pay-per-call advertisers” and “is probably the biggest” pay-per- call network.

In an interview with The Local Onliner, Vice President of Product Andrew Shotland, wouldn’t comment on rumors that the company is in talks to be acquired , but he happily chimes in that the company would be “an interesting fit with a lot of companies.”

He notes that the company already licenses its 350,000 + reviews – including more than 5,000 reviews in each of the Top 30 markets – to one of the biggest Internet brands, and several others. Although Shotland would not reveal names, citing contractual reasons, he notes that “our reviews pop up all over the place.”

Jupiter Forecast: Local $ Grows, But Disappoints

Local advertisers have discovered the Internet and will boost their advertising 26 percent to reach $3.2 billion this year. But after that, they’ll grow just 11 percent per year through 2010, reaching $5.3 billion, according to a new Jupiter Research report, “US Local Online Advertising Forecast, 2005 to 2010.”

According to Jupiter’s analysts, local advertising will fall short in its transition to the Net, as most local businesses will be slow to jump online. Instead, local online advertising will remain centered on national firms targeting on a localized basis.

Why? The portals won’t invest in local sales forces, and existing local advertisers see better leads coming from word of mouth, magazines, trade shows and other offline marketing tactics. “They are just beginning to build databases of email addresses,” notes Jupiter.