Key Yahoo Newspaper Consortium Player to Helm Philly.com, Future Sites

Eric Grilly, current president and CEO of MediaNews Group Interactive will leave his position to serve as president of the much smaller Philly.com. Grilly has played an instrumental role in the development of the ad distribution deal between Yahoo and a group of 10 newspaper publishers. His move to Philly could have implications for the implementation of the Yahoo arrangement. It also represents the struggle paper publisher execs are experiencing when juggling the needs of interactive newspaper divisions with legacy print operations.

“One of the first things we’ll do is redesign the Web sites,” Grilly told ClickZ News, noting his plans to “make significant investments in people and technology” to improve Philly.com, owned by Philadelphia Media Holdings, an independent company. “This gets me back into an operational capacity in the organization,” said Grilly of his new gig. He has been with MediaNews for eight years.

PMH puts out Philly.com, the online home of its print papers, The Philadelphia Inquirer and Philadelphia Daily News. The transition from MediaNews Group, publisher of 74 Web sites and 54 newspapers, to the far smaller firm, however, may mean Grilly will oversee only Philly sites forever. Indeed, according to PHM CEO Brian Tierney, the company aims to become an incubator for local media projects.

“We have an opportunity to use Philly.com as an interactive platform to try out a lot of things,” Tierney told ClickZ News. “We may look to create a fund specifically to take that up and increase velocity,” he added, noting these potential online properties would be developed “all under Eric.”

Accepting the position appealed to Grilly because of the publisher’s independence and entrepreneurial spirit, things he thinks will aid PMH in surviviving the tumultuous changes affecting the newspaper industry. PMH itself experienced its own set of problems recently, laying off 17 percent of its editorial staff in January. Still, because of its small size and current single-market focus, some think PMH has fewer headaches than larger paper publishers when it comes to balancing interactive operations with the needs of legacy print divisions in multiple markets.

Grilly told ClickZ News he wasn’t frustrated with juggling traditional and digital businesses at MediaNews Group, but he continued, “Legacy issues did get in the way of approaching new opportunities.”

Grilly has some loose strings to tie up before he departs. Specifically, he will help finalize contractual negotiations for the so-called Yahoo Newspaper Consortium, which he’s been closely involved with throughout its development. He expects the business terms of that deal to be agreed upon by the first or second week of April. The initial integration currently taking place will push Yahoo’s HotJobs recruitment classifieds across the newspaper sites, and feature the publishers’ job ads in the HotJobs database.

MediaNews Group Vice Chairman and CEO Dean Singleton has been another major player in the development of the Yahoo deal. The publisher had already partnered with Yahoo to distribute the Yahoo HotJobs listings. The Yahoo group, officially formed in October 2006, includes Belo, E. W. Scripps, Cox Enterprises, Hearst and other paper publishers.

Grilly’s departure “is a loss to the consortium,” said Ken Doctor, newspaper industry pundit and lead news analyst at media market research firm Outsell. “Eric’s experience on this, his closeness to Dean Singleton…all of that will be lost,” he added.

Asked whether Philadelphia Media Holdings would be the next to join the Yahoo consortium, Grilly only answered, “Stay tuned.”

Tierney implied a Yahoo partnership with Philadelphia Media Holdings is not in the cards, at least when it comes to job classifieds. “We had conversations with Yahoo earlier in the summer…primarily focused around HotJobs,” he said. “We felt the Monster product offered us a particularly stronger opportunity and it’s worked out quite well.”

Philly.com launched a co-branded job search and recruitment site with Monster in August.

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