There is a lot happening in the local search and media worlds today. Here are some notables.

Yahoo! has coughed up $680 million for the remaining stake in online media exchange Right Media. It previously owned 20 percent of the company. This could partially be a counter shot to Google’s purchase of DoubleClick, as DoubleClick has a yet-to-be proven ad exchange of its own. Both moves, generally, are an attempt to improve display ad capabilities. More on the Yahoo! deal from Red Herring and The New York Times, and on the Google deal (for subscribers) in the recent TKG Advisory DoubleClick and Clear Channel: Google’s One-Two Punch to Increase Ad Reach.

EBay has launched a handful of interesting widgets that let any seller take his or her listing “to go” and plant it on a blog or Web site. They have flash-based animation and should serve to push out eBay listings and give them more exposure than they would get on eBay proper alone. This is an uncharacteristic move for eBay, which is usually a closed system, and is in the same vein as the recently launched vFlyer widgets we wrote about here.

This could gain significant traction in eBay’s strong autos category where many dealers will likely jump on the opportunity to plant their eBay listings on their own sites in a more-user friendly way. It could also represent a testing ground for new flash-based functionality before eBay integrates it on its own site. TechCrunch has screenshots.

The New York Times takes a look at a handful of companies, such as Zebo, that help people catalog and value all their earthly possessions and post them online. Meanwhile, a new site for packrats to trade items, iwannatrade.com, launched today with an auction-based model and flat listing fees.

GigaOm asks, Does advertising in virtual online realms (such as Second Life) work? This is an area that received a great deal of initial excitement, bordering on irrational exuberance, which has since been reined in with a fair amount of criticism. There are still some interesting local implications and opportunities, further examined in a past post. IAC meanwhile launches its own online virtual world Zwinktopia.

Search Engine Roundtable reports on the first signs of Google’s anticipated Pay Per Action ads.

New York-based directory publisher Ambassador Publications has launched a new online bid management and reporting platform, explained here.

Lastly, the Interactive Advertising Bureau of Canada reports that Canadian online ad revenues reached an all-time high of $1.01 billion in 2006. More from the press release.

Some of these items deserve a deeper dive and we’ll revisit them accordingly.

For a variety of reasons, I am unable to attend this year’s YPA Annual Convention in Las Vegas. The Kelsey Group is very well represented at this conference, just as we were at the Association of Directory Publishers event a few weeks ago. Nevertheless, I really like to attend to network with old friends, spend time with clients and prospects, learn from some of the great speakers, and participate in the lively discussions that take place both in the breakout sessions and in a more social environment. It is, of course, a lot less stressful to attend an event that somebody else is running than one of our own.

One of the reasons that these events are so interesting is to listen to the optimism from the podium. I imagine Kathy Harless, Denny Payne and Neg Norton all reporting that we are facing challenging times. However, because of the industry’s strong market position, feet on the street, dedicated employees, commitment to innovation and the directories’ convenient location in the kitchen drawer, the industry continues to be very healthy. Just last week R.H. Donnelley, AT&T and PagesJaunes all announced earnings that were basically in line with what analysts had anticipated. Print growth was somewhat disappointing, but the online segment showed continued strength.

Yell Group’s U.S.-based operations, Yellow Book, whose growth actually exceeded that of the previously mentioned companies, is experiencing a decline in its organic growth rate. Since the percentage growth projected for the remainder of the year was below that anticipated by Wall Street, Yell Group’s stock took a big hit. The combination of the sheer size of Yellow Book, the number of companion books put out by incumbent publishers and new books from small companies emulating Yellow Book’s strategy (and in many cases its look and feel) led to the inevitable slowdown.

Tuesday, May 1, The Kelsey Group will be active participants in two important sessions. Charles Laughlin, senior vice president, program director of The Kelsey Report, and managing editor of TKG, will give a presentation at the International Member Lunch on Global Yellow Pages and the Directional Media Forecast 2007-2011. Later in the day, Neal Polachek, senior vice president, research/consulting and advisory services, will be providing a different perspective of the future in his provocative presentation, A Case for the “Print on Demand” Directory. Today he was scheduled to introduce the keynote speaker, Chris Anderson, editor in chief of Wired Magazine.

Check out this YouTube clip of Marge Simpson using Google Maps and a variety of other local online activities. It’s a good parody of online media for a Friday afternoon, which takes jabs at Google, online shopping and online gaming, among other things.

Now if Google Maps can only settle the debate over what state Springfield is in (my money is on Oregon, near Matt Groening’s hometown of Portland).

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Update: It seems that there are more folds to the Simpsons’ ties to local search and mapping. Comment from SarahM points out that there is a real-life replica of the Simpsons’ home that can be found on Zillow (interestingly in Las Vegas’ sprawling suburbia). Try to guess the estimated value.

The next wave of online mobile has taken a step forward with the introduction of voice recognition technology. In a recent Boston Globe article, several new voice applications for mobile Web search are discussed including Microsoft’s recent acquisition of Tellme. So what’s all the excitement about? In the U.S., mobile Web usage remains relatively low. ClickZ reports: “An average 29 percent of European Internet users access the Web on mobile devices. This includes users in Germany (34 percent); Italy (34 percent); France (28 percent); Spain (26 percent); and the U.K. (24 percent). In the U.S., 19 percent of Internet users access the Internet on cell phones and other mobile devices.” In a survey conducted by Yankee Group in April 2006, “about 18 percent of wireless users in the U.S. said they had at least tried using the mobile Internet, but only 6 percent considered themselves regular mobile Internet users.”

In Europe and Asia, people tend to be more mobile, spending more time out of their homes and on public transportation, which allows them more time and freedom to access the Internet via mobile phone. For anyone who has spent time in Japan, Korea or China, the use of mobile Web applications is a daily, if not hourly, habit. In the U.S., people tend to spend more time in their homes, where they prefer to access the Internet on their desktop, and in their cars, where it is almost impossible to navigate the Web on a mobile phone. With the introduction of voice recognition for mobile search, consumers in the U.S. can simply verbalize their search needs and have content delivered to their mobile phone to be used when they have the time and availability. Having the ability to time shift their search or get immediate feedback will not only simplify mobile search, but should also encourage increased usage potentially taking away market share from directory assistance.

“Speech in general has been that technology that’s always right around the corner. And we’ve clearly, over the last couple of years, turned that corner,” said Jeff Van Rhee, a senior analyst at Craig-Hallum Capital Group in Minneapolis. “Now we’re just getting into the handset, where there’s really value added.” If directory companies and online verticals can develop voice- enabled products for local businesses, then location-based advertising can take a giant step forward. Local SME advertisers can then be offered the option of text and graphical-based advertising as well as voice-enabled options where both graphics/text and voice can be sent back to consumers when they make a voice query. It will fall to the search engines and directory companies to develop local voice-enabled content in order to make voice-enabled search on a local basis work effectively.

The future of mobile Web search is on our doorstep. Much like Star Trek, consumers can now ask for something and visuals and voice files are delivered on the spot. In an age where consumers continue to seek immediate access to information, this new voice-enabled search technology allows a mobile phone to go where no search engine has gone before.

Coming off NearbyNow’s $5 million B round, I had the chance to talk to CEO Scott Dunlap today.

Part of this announcement is an expressed goal to be in 103 U.S. cities by November (Dunlap stated this goal to me in a less official way in a previous post). It’s currently in 20 cities and roughly 30 malls, a function of the mall partnerships it has been able to form over the past six months, including one with the Westfield Group.

Through this growth, it continues to develop various parallel distribution strategies. Its main product is a private-label local shopping research and inventory search engine that powers mall partners’ Web sites. Here individual retailers can list products, promotions, coupons and inventory, which is paid for on a cost-per-action basis when users reserve items or redeem trackable promotion codes or coupons. This comes with a full performance reporting dashboard.

Ultra-Local Mobile Search
But the most interesting direction for the company could be its mobile product. It has developed an SMS-based tool that lets shoppers search for deals while they are in the mall. This not only has the benefits of proximity and captive audience, but there is also an overlap between the demographics of the average young mall-goer and those for which text messaging is a popular and frequently used medium.

Surprisingly, this has also caught on among another large demographic of mall shoppers, according to Dunlap: the soccer mom.

“Moms are learning how to text message,” he said. “Either ’American Idol’ has taught them, or in some cases, It’s the only way their kids will talk to them over cellphones, so they’ve learned how to do it out of necessity.” Much of this product’s use so far has involved people texting in to see if there is a better deal on an item somewhere else in the mall before they buy it.

Promotion codes are used for tracking in most cases, which is a challenge for chain retailers, according to Dunlap, because store level clerks have to be trained to accept promotion codes. This is one of the major challenges in mobile coupons overall, but Dunlap claims it isn’t as great in the microcosm that is a shopping mall.

On-Site Search
The company also places kiosks within malls that let shoppers look up deals or print out coupons, for which the redemption issue isn’t as great. Interestingly, there are also display ads served on these terminals for actual products or stores that can be steps away. This proximity factor leads to unusually high CPM rates, according to Dunlap.

“With a banner ad for a pair of jeans that is 100 yards from the store, I’ve seen CPMs north of $125,” he said. “People understand the value of proximity.”

Interestingly, Dunlap claims in his informal polling of mall retailers that use the service, 100 percent of the budget reallocation comes from newspapers. He contends it’s the same (but much more efficient) use of local marketing dollars to drive foot traffic. The reporting capabilities and dramatic difference in pricing between its online performance-based model and newspaper circular rates have a lot to do with this.

He claims, in fact, that some chain retailers have told him they can cut one store’s local newspaper circular per quarter to pay for the equivalent of 100 (individual store) NearbyNow search-based marketing campaigns. This is purely anecdotal and should be treated as such, but if true is a powerful statement.

What’s Next?

The next steps for the company include building in social and personalization features to its online and mobile products that let users search for and save items they want, and also share them with friends.

“Someone can form a back to school list and send to their parents,” said Dunlap. “This summer we’ll be experimenting with that.” (a TKG report on this “save and share” trend is forthcoming).

This could also involve alerts, where a shoppers are notified via text when an item becomes available or a sale happens with a particular item or store. With this type of alert, users explicitly state what they want and implicitly state that they are ready to “pull the trigger” if the item is available.

As pointed out in the TKG advisory RSS and Email Alerts: Shopping 2.0, this can imply a very strong and clear intent to buy which, combined with the proximity factor, helps Dunlap continue to prove the company’s value proposition to mall retailers.

Given these directions, 100+ malls by November seems likely.

As we’ve expressed in past writing, the targeting abilities and architecture of IPTV could open up some interesting local advertising opportunities (also see TKG White Paper From Reach to Targeting: The Transformation of TV in the Internet Age).

But it’s been a while since we’ve written about IPTV here. So here is a quick and long overdue roundup of some interesting IPTV items.

Rocketboom has an interesting video interview with Joe Savage, president of the Fiber to the Home Council, in which the benefits of fiber to the home (the backbone of many IPTV efforts) are explained in everyday language.

Daily IPTV has a list of the top IPTV-focused blogs. A good reference point for anyone interested in IPTV (and starting point to get some good RSS feeds).

The Wall Street Journal (sub req.) has an article on set-top boxes for IPTV and on Apple TV.

EMarketer has data on global IPTV use.

Lastly, 3 Screens poses the question, can IPTV and online video coexist? IPTV, to clarify, is separate from online video (YouTube, etc.) and refers to IP-based delivery of video content to your television in a service package from a telco provider such as AT&T or Verizon. (also see Triple Play.)

On a related note, a TKG report is due out next week on video advertising, and how many local advertisers are starting to catch on, given accessibility and new price points from the likes of Spot Runner and TurnHere. To use an ending note that I overuse (which in this rare case, seems appropriate), stay tuned …

I only have time for a quick post, but it strikes me how so many local search plays are launching SMS-based search services.

As noted earlier, NearbyNow has this; vFlyer launched a mobile search product today; Vehix.com plans to do this; and earlier in the week I spoke with BooRah about its new SMS-based local search product.

These join the longstanding Google SMS and Yahoo! Mobile, as well as more recent SMS local search products from Tellme and Yellowpages.com. SMS-based local search is becoming more and more attractive, given that texting is the most prevalent form of mobile search, and is the most used mobile device feature, besides talking (further analyzed in this post).

But there seems to be a trend toward verticalization, given the above products (restaurants, shopping, classifieds, autos, etc.). In some cases, it is even more specific and drills down to an individual brand such as Starbucks (there are few brands that will be able to pull this off, if any).

It will be interesting to see, among all the other questions swirling around the mobile local search space (and mobile in general), whether general search or vertical search will win out. The same question has loomed over the online local search space for some time, and in the same way we’re seeing a trend toward verticalization, given its many advantages (explored here). More on this later.

HP is serious about working with small businesses and announced today that it is buying Logoworks, the disrupting producer of logos for small businesses. It will be a great acquisition for HP.

When it launched in 2001, the premise behind Logoworks was that most small businesses don’t have logos, and that they’re scared off by the high cost of building a logo, the delay in getting one done and often unsatisfactory results. Without a logo, many small businesses don’t take the next logical steps of marketing (business cards, brochures, newspaper ads, Web sites, etc.).

Logoworks founder Morgan Lynch, part of a group of highly entrepreneurial Brigham Young graduates in Utah, knew there had to be a better way. He was in his 20s and personally knew lots of freelance designers who would be delighted to earn some pocket money. But first they needed the customers.

So Lynch and his team (including Jeff Kearl, who had been with Freeport) constructed a software system that would create a “bakeoff” between designers who would design the best logos for customers. Customers would choose the best design among three to five designers, depending on what they wanted to pay for. And the price would be $300 to $500, just a fraction of the cost of using a design shop. The turnaround could be in three days or less.

Today, with 45,000 logos behind it, the company works with more than 200 designers from around the world, and a core staff of 100 or so in Linden, Utah, near Salt Lake City. It has also branched off into Web sites, business cards, brochures and general graphic design. It even handles some corporate accounts, like Disney, Microsoft and SeaWorld. (It is interesting to see how small-business companies like Spot Runner and Logoworks end up handling larger accounts that want their flexibility, speed and ability to work across the board.)

I did a little consulting work for the company a few years ago. Since then, I’ve never gotten tired of talking about its story. Sure, Lynch had gotten into deals on his own with PIP printing, Mr. Speedy and other printers. The printers understood logos as easy upsells. But the reason he hired me was to see if we could get some traction with some of the major Yellow Pages and local-oriented Web firms that worked with small businesses.

Were we successful? Basically, most of them said they just wanted to resell “Web sites, Web sites, Web sites,” which have bigger margins than logos. It didn’t seem to matter to these companies that their customers probably needed a logo just to get started. From our point of view, logos could serve as their entrie into the small-business world and lead to broader accounts. The only company that really “got it” was Constant Contact, which publishes e-newsletters for small businesses. Today, Constant Contact’s Eric Groves sits on the Logoworks board.

My experience with Logoworks was a great lesson for me. What I learned was that most of the companies that have small-business products are basically there to sell their own, existing products. They don’t actually work with the small business. HP, it seems, is determined to change that.

MapQuest today announced a partnership with GM’s OnStar division that will allow online users to send maps and turn-by-turn spoken directions to their OnStar devices.

This falls in line with the cross-platform personalization that we’re seeing a lot of in the local search world (a related TKG report is forthcoming). Send to Mobile functionality is one example, and Yahoo! Go is a more sophisticated system for storing personalized data and preferences on a central server, which can be accessed across all connected devices.

Interestingly, the MapQuest integration with OnStar doesn’t use MapQuest’s maps, but rather utilizes its leading market share and contact with so many online consumers as a catalyst to this process. In other words, according to MapQuest VP and GM Jim Greiner (during an analyst call yesterday), the system works by MapQuest simply sending an end location to OnStar, which is then processed by OnStar’s systems to store and provide turn-by-turn spoken directions.

It will be an interesting partnership in that it combines two leading brands in their respective fields. This gives it a natural adoption advantage; however, it is still a closed system and can’t be used on multiple platforms (although MapQuest is working on many fronts to make itself pervasive across devices, with MapQuest Navigator, MapQuest Mobile and send-to-cell functionality).

The capability is already built into 2 million 2007 vehicles that contain OnStar’s Generation 7 hardware. It will be built into an additional 3 million automobiles in 2008.

Tired of using “San Francisco” as the metaphor for “all things Internet?” How about focusing on “bloggy neighborhoods”?

Beth Lawton at NAA New Media Fed alerted the readership to a list of Top 10 bloggy neighborhoods compiled by Outside.in, the tracker of 3,000 U.S. neighborhoods. The list may be a little skewed. It not only includes total number of bloggers and comments, but Technorati also rankings for the bloggers and total number of posts. What I’m seeing are a bunch of rapidly gentrifying neighborhoods. It is still a lot of fun.

Here they are:

1. Clinton Hill, Brooklyn
2. Shaw, DC
3. Downtown LA
4. Newton, MA
5. Rogers Park/North Howard, Chicago
6. Pearl District (”The Pearl”), Portland
7. Watertown, MA
8. Harlem, N.Y.
9. Potrero Hill, S.F.
10. Coconut Grove (”The Grove”), FL

I’m especially focused on No. 7, which is driven by Lisa Williams’ excellent H2oTown. Lisa, a former Yankee Group analyst, has really bootstrapped her entire community. She’s currently working with Bob Kempf’s team at Boston.com on its ambitious community project.

Williams, in a comment to my sister blog, noted that “All of the communities on the list are densely populated near suburbs or outer boroughs of major metro areas.

“Why would outer boroughs/near suburbs be more “bloggy” than major metros, exurbs, or smaller cities? My theory: the nearby major metro daily soaks up the ad revenue that would otherwise support the local, usually weekly, paper that covers the near suburb/outer borough. The result is a metro daily that provides inconsistent coverage of their area, and a local news source with shrinking newshole. This creates an ecological niche for a placeblog or online community site for that neighborhood to flourish.

“It’s true that they’re all in areas where house prices rose dramatically during the last decade, but you can say that about the near suburbs/outer boroughs of all of the top 50 metros in the U.S. So it’s not house values that are driving the creation of web-based local community sites: it’s shrinking and inconsistent news coverage in the tight band around major metros.”