Yahoo Aligns with Newspapers, Major Impact for Local Ads

An alignment announced today between Yahoo and seven newspaper publishers could give the portal a local presence in several regions and provide the papers with the online reach they need to survive. As Yahoo, Google and others battle over online ad dollars from a virtually untapped market of local advertisers, the potentially wide-scale integration is poised to move well beyond an initial focus on job recruitment classifieds to entail distribution of search and display ads, content and Yahoo applications. It’s also another signal newspapers are willing to work with online properties that have been eating their classifieds lunches.

The agreement will deploy “a huge sales force involving thousands of sales professionals” to sell ads on behalf of the papers and Yahoo, across what the new partners are calling a “consortium,” said Dean Singleton, vice chairman and CEO of MediaNews Group, publisher of papers such as The Denver Post and The Detroit News, in a conference call today. The newspapers’ individual sales forces will continue to sell classifieds to local advertisers, offering distribution through HotJobs, and providing Yahoo with a cut of revenue.

Both MediaNews Group and consortium member Belo already partner with Yahoo to distribute HotJobs listings; those relationships snowballed recently into the newly-inked deal.

The initial integration, expected soon, will push Yahoo’s HotJobs recruitment classifieds across more than 150 newspaper sites, and feature the publishers’ job ads in the HotJobs database. The new network’s job classifieds sections will be co-branded by the individual papers and Yahoo HotJobs.

According to a September report from local media research outfit Borrell and Associates, recruitment ads account for 4.1 percent of all locally-spent online advertising.

“We expect to drive new and larger audiences to each of our newspaper online sites,” said Singleton. In addition to enhancing Yahoo’s local content, he continued, the deal will provide the paper firms with “access to Yahoo’s expanding local audiences which include desirable younger audiences.”

The partnership will bolster Yahoo’s news content and better optimize it for the portal’s search engine and other site sections. It is also meant to give Yahoo more places to push out its own local content offerings, search and other applications, including its maps, local business and event listings and search toolbar and sponsored search ads.

“All parties bring significant attributes and benefits the other doesn’t have,” said David Teitler, president of DotConnect Media, a national ad network owned by consortium member Lee Enterprises.

The publishers involved in the deal are Belo, Cox Enterprises, E. W. Scripps, the Journal Register Company, Lee Enterprises, and Cox Enterprises, as well as Hearst, which also partners with Google to run its text ads in Hearst print publications.

“We expect others to join us in the very near future,” said MediaNews Group’s Singleton.

The potential use of the HotJobs platform across the paper site network could help the ailing newspaper industry compete in an increasingly fractured media world. The deal gives the paper publishers the chance to work together, and could make it easier for advertisers to buy job ads across multiple local publications, said Peter Krasilovsky, principal of local media consulting firm Krasilovsky Consulting.

“This might be the right model for ‘coopetition,’ ” Krasilovsky added. However, the newspaper firms involved in the deal will have to prove they can work together if the Yahoo relationship is to succeed, he continued. Paper publishers, with storied histories of regional rivalries, have yet to demonstrate they can collaborate online on a broad level.

Yahoo’s new network partners could help it compete against Google, which recently began testing print ads sold through its system via more than 50 newspaper partners including The New York Times, The Washington Post and The McClatchy Company.

The consortium may also give HotJobs a leg up against CareerBuilder, which partners with Gannett, Knight Ridder and Tribune papers.

“We looked at joining CareerBuilder but that’s strictly a career site, and that’s where it stops,” said Singleton. “With Yahoo it opens many, many doors we need to have open to us.”

Still, the new partnership is yet another indication new media realities are making for strange Web-fellows. Indeed newspaper publishers have had classifieds revenue siphoned away by the likes of Yahoo, Google, Craigslist and other online properties pushing local offerings.

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