Yahoo!, SBC in Yellow Pages Deal

Yahoo will gain a new sales channel for its yellow page listings by tapping its partner for Internet access, telco giant SBC Communications .

Through the arrangement, San Antonio, Texas-based SBC’s sales force will begin representing Yahoo Yellow Pages’ ad units and sponsored listings, in addition to SBC’s own SMARTpages.com.

Sponsored listings place advertisers in a position above locally-organized business listings, which are provided by Yahoo partners InfoUSA and BellSouth . The sponsored listings, which appear in connection with users’ keyword searches, can include graphics and brief ad copy. Other ad formats sold include keyword-based buttons at the top of yellow pages search engine returns.

It’s expected that SBC will begin selling the inventory — which is also syndicated on Yahoo’s wireless site — by the end of the year.

The agreement benefits Sunnyvale, Calif.-based Yahoo by having SBC’s larger, more regionally-focused sales operation handle local clients.

That marks a significant change from the way that Yahoo previously sold its Yellow Pages listings — through reps focusing primarily on bringing in large, national advertisers. That’s presented a problem because most yellow page advertisers tend to be smaller, local businesses — which are harder, and more costly, for organizations to corner without a local presence like that offered by SBC’s 2,500-person sales force.

As a result, sources close to the firm say Yahoo’s Yellow Pages reps faced difficulty in finding advertisers to fill the site’s available local inventory. In many instances, national advertisers filled in the blanks — resulting occasionally in missed opportunities. For example, a user searching in the Banks category of the New York City listings sees ads for Washington Mutual and Bank of America, neither of which has banking locations in the area.

“Our agreement with SBC gives us access to an enormous sales channel and underscores Yahoo’s commitment to the online Yellow Pages and listings space,” said Elizabeth Blair, senior vice president of Yahoo’s Listings business unit. “The combination of Yahoo’s brand and reach with SBC’s high-quality sales teams and customer service strongly positions us for success in this key area.”

Many media players like Yahoo consider yellow page listings valuable because ads based on keywords — like search engine listings from players like Google and Overture — are believed to be more resistant to the protracted downturn in online media spending. Verizon , for instance, continues putting heavy promotional dollars behind its SuperPages.com offering.

For its part, SBC said it expects to benefit by being able to offer its customers expanded reach through inventory on one of the largest yellow pages sites. In May, Yahoo Yellow Pages saw about 6.7 million visitors and generated about 162 million page views, according to Nielsen//NetRatings .

“Yahoo’s wide reach and strong brand will help our advertisers reach more potential customers and generate more revenue for their businesses,” said Jason Few, vice president of SBC-Yahoo implementation at SBC. “We believe this partnership increases the value of our SMARTpages.com product offering.”

The deal expands on a months-old strategic alliance between the two companies, centering on the rollout of co-branded dialup Internet access. The pair also plan to launch co-branded DSL service later this year, and small-business services early next year.

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