Archive for the ‘Revenues’ Category

Is the ReachLocal IPO Imminent?

May 18, 2010

I recently ran into someone from ReachLocal at a conference and asked whether the company had pulled its IPO. That had been the rumor circulating. I was told no that it was still a go.

This morning someone emailed me and asked if I was going to buy any ReachLocal stock when the IPO happened “later this week.” Beyond the fact that I don’t own any stock in any company I write about I said I hadn’t heard that the IPO was imminent. The person I was emailing said that he was being told by some friends in Wall Street firms that it was coming very soon.

Here’s the original S-1 filing from December 2009 and some interesting data about the company:

At September 30, 2009, we managed 17,600 Active Campaigns across 14,500 Active Advertisers, a substantial majority of which we calculate spend from $500 to $3,000 per month with us. Our clients include SMBs in a number of industry verticals, such as home repair and improvement, automobile sales and repair, medical and health services, legal services and retail and personal services. Since inception, we have delivered to our SMB clients more than 250 million geographically targeted clicks and 20 million phone calls. We employ 525 IMCs in North America, Australia and the United Kingdom and work with over 350 third-party agencies and resellers that use the RL Platform to serve their SMB clients. We intend to expand our IMC sales force both in existing and new markets.

We generate revenue by providing online advertising solutions for our clients through our ReachSearch, ReachDisplay, Remarketing, TotalTrack and other products and services. We reported $146.7 million in revenue in 2008 as compared to $68.4 million in 2007, an increase of 115%, and $143.3 million in revenue in the nine months ended September 30, 2009, a 37.5% increase as compared to the same period in 2008.

It will be great to have a public company as a kind of barometer (beyond the YP companies) for how the local segment is doing. However I think ReachLocal has several challenges:

  • Growing the advertiser base at rates sufficient to satisfy investors (though that’s arguably a formula that the company now has “down”)
  • Retaining advertisers (this is more challenging though Reach says its churn is lower than others)
  • Attracting and retaining quality sales staff at lower commission rates and salaries than they were making in YP positions

Public companies are subject to brutal pressure from the whims of fickle investors. The executives at Reach have worked hard and I wish them well. But I’m glad in a way that I’m not in their shoes.

Update: Joe Tartakoff at PaidContent just pointed me to confirmation that it is happening this week.


DexOne, YPG Announce Q1 Results

May 6, 2010

Both publishers posted Q1 2010 results today. Revenues and earnings were down in both cases, although YPG fared better.


For the quarter ending March 31, 2010, consolidated net earnings were $121.8 million compared with $132.1 million for the same period in 2009. Income from operations was $166.8 million versus $185.7 million last year. Cash flow from operating activities reached $143.5 million during the quarter as compared to $197.4 million in 2009.

Consolidated Adjusted Revenues and revenues, at $408.1 million, decreased by approximately 1% and $0.2 million respectively from last year. Consolidated Adjusted EBITDA was $219.8 million, down from $225.9 million twelve months ago. EBITDA (income from operations before depreciation and amortization, and acquisition-related costs) was $216.1 million compared to $223.9 million in 2009. EBITDA on a reported basis is net of non-recurring rebranding and conversion costs aggregating $3.7 million in the first quarter of 2010 . . .

Combined online revenues for Directories and Vertical Media reached $98.4 million for the quarter or $393.6 million on an annualized basis, representing online organic growth of 20%.

If I’m doing the math right, online revenues were 24% of overall.

DexOne (formerly RHD) “a leading provider of marketing solutions for local businesses”:

New accounting rules/procedures make the results apparently anomalous. But here are some excerpts from the release:

“First quarter ad sales declined 19 percent largely reflecting selling activity during the third and fourth quarters of 2009. Recent sales campaigns are generating sequential improvements in ad sales trends, which we expect to continue throughout the remainder of 2010 . . .”

Dex One is affirming full year 2010 guidance originally provided on March 4, 2010:

— Year over year decline in advertising sales of between 12 percent and 15 percent.

— Combined adjusted net revenue(1,2) of approximately $1.8 billion and net revenue of approximately $0.9 billion.

— Combined adjusted EBITDA(1,2,3) of approximately $750 million and operating loss of approximately $100 million.

— Combined adjusted free cash flow(1,2,3) of approximately $450 million and cash flow from operations of approximately $400 million.

Again: “Year over year decline in advertising sales of between 12 percent and 15 percent.”

To what extent is this a benchmark for the rest of the industry?

DexOne FY 2009 Results

March 4, 2010

The former RH Donnelley reported full-year 2009 results this morning. Here they are:

Last year revenues were reportedly down approx 20% vs 2008. There’s no breakdown of online as a percentage of revenues.

This was interesting for 2010 guidance:

Year over year decline in advertising sales of between 12 percent and 15 percent.

I would assume that’s chiefly about the decline in print advertising.

Future of Journalism Starting to Emerge

October 25, 2009

This isn’t going to be some lengthy “think piece,” just a smattering of quick observations because I’m trying to get some stuff done this morning. But here’s a sampling of what’s going on:

  • The NY Times recently began a SF Bay Area edition, with some related Web content.
  • Of course there’s the non-profit Pro Publica for investigative journalism (ongoing funding remains uncertain however).
  • Then in the Bay Area also there’s a collaboration between local public radio station KQED, UC Berkeley’s J school and maybe the NY Times.
  • There’s Susan Mernit’s newish Oakland Local, effectively a blog that has a hybrid magazine-newspaper flavor.  (There are scores of local blogs that have a quasi-news dimension, many presented on
  • There are the online-only former newspapers, such as the Seattle PI, among a growing number of others.
  • Radio and TV will fill some of the void left by those daily newspapers that have failed — or will fail
  • There will obviously continue to be news aggregators such as the Huffington Post, Yahoo! News, Google News and the new Hearst aggregation effort LMK.
  • There will experimental print efforts (such as printed personalized newspapers).
  • Many traditional newspapers will of course remain and build sustainable print-digital models.

The competitive landscape is flatter online; so news sources from different mediums as well as blogs “compete” with one another. In addition, on mobile devices (smartphones, eReaders) all these news sources are portable like traditional magazines and newspapers.

As the bullets above suggest there is no single model that will prevail, a cacophony of sources and models will co-exist. The central challenge is not journalism or the delivery of news and related news-feature content but the financial models that support these efforts. And there will likely be several parallel models:

  • Non-profit (Pro Publica) supported by donations and foundations
  • Collaboration that involves shared costs (Bay Area News project)
  • Traditional for profit news (subscription + ad support)
  • Free, ad-supported online pubs
  • Subscription only as an option (where there are ads in the free version and no ads for subscribers; Salon does a version of this).

The outstanding question is whether the subscription models for news that are about to be (re)imposed will take hold and be accepted by consumers. Regardless, it emerges as a very creative time. And though there’s tremendous instability in the business of news creation and journalism there’s also opportunity for those with vision and the ability to execute.


Related: Tim Armstrong’s Secret Project Is To Turn AOL Into A Low-Cost Content Machine

See also: Online only Christian Science Monitor is reportedly doing well.

Opt-Out and the Directory Dilemma

August 14, 2009

Yesterday the Yellow Pages Association announced the launch of “” that seeks to “help consumers choose which print directories they want delivered to their door steps.” According to the press release: aggregates delivery information for Yellow Pages publishers in one place, making consumer choice simple, secure and effective. Users type in their zip code and receive a list of local publishers with the appropriate steps to stop delivery or adjust the number of directory products they receive.

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This initiative, together with the YPA’s “Yellow Is Green” efforts are probably now necessary to respond to and preempt criticism from different groups and consumer advocates about the environmental impact of printing directories when the Internet appears such a viable alternative. In addition, they help prevent legislative action from gaining momentum around compelling an “opt in” policy to receive print yellow pages. However, opt-out may inevitably lead to opt-in . . .

Right now there’s a movement afoot to make delivery of white pages opt-in. This is being pushed by the directory publishers themselves in large part. Unlike in other parts of the world where white pages generate ad revenue, in the US it’s a pure cost center. Hence the agreement to reduce white pages’ publication and delivery. 

Along those lines, yesterday I heard a piece on NPR triggered in part by a survey:

WhitePages today unveiled the results of a survey of nearly 1,000 US adults that finds 81 percent of consumers are willing to embrace “opt-in” programs to receive the white pages phone book to help save the environment and tax dollars. According to WhitePages, the largest and most trusted online and mobile directory, if every US household stopped receiving the white pages phone book, millions of trees and up to $17 million in taxpayer funded recycling fees would be saved every year. “Opt-in” is defined as receiving a white pages phone book only if you request one. has also launched a site called “Ban the Phone Book,” which seeks to educate people about the environmental impact of printing directories. 

Did you know that up to 5 million trees are cut down each year to create the white pages phone book and that taxpayers are spending $17 million each year to have these books recycled? Even more surprising is that almost 75% of consumers are completely unaware of the environmental and financial impact in printing, delivering and recycling these books. 

The danger for the industry in actively promoting an “opt-in” strategy for print WP is that it may quickly bleed over into print YP. After all the industry is promoting “opt-out” for YP, why shouldn’t it simply move to opt-in, given the environmental impact arguments apply equally to YP as well. There’s no distinction between WP and YP from a logical perspective. The distinction in internal to the industry: cost center vs. cash cow. 

The “book” as in “Ban the Book” will equally extend to YP in the popular mind. So, as you can see, the combination of all these initiatives will put increasing pressure on print YP to go from opt-out to opt-in. If that happens, it would accelerate the revenue losses that print YP is currently seeing.

Tech Companies Among Inc’s 500/5000

August 13, 2009

Picture 3Inc Magazine has done its annual ranking of the fastest-growing small companies. There are many tech companies on the list but three that proactively reached out to me were G5 Search Marketing, ReachLocal and Angie’s List. I don’t have the time to comb through the entire list (which is not that user friendly) to pull out everyone interesting.

Here’s how companies make the list (and presumably the revenue numbers are real):

The Inc. 500|5000 is ranked according to percentage revenue growth from 2005 through 2008. To qualify, companies must have been founded and generating revenue by the first week of 2005, and therefore able to show four full calendar years of sales. Additionally, they have to be U.S.-based, privately held, for profit, and independent — not subsidiaries or divisions of other companies — as of December 31, 2008 (a number of companies on the list have gone public or been acquired since that date). Revenue in 2005 must have been at least $200,000, and revenue in 2008 must have been at least $2 million.

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Is a Newspaper Turnaround Afoot?

August 10, 2009

There were a number of separate items about newspapers from the past few days. First, on the bad news front, comes a kind of early eulogy for print newspapers in Philadelphia, the first “big city” in the US that may not have a daily (stay tuned).

On a more upbeat note, the Seattle Times is back in the black and apparently growing after the demise of the print edition of the Seattle PI, although that website appears to be holding its own as well. According to the NY Times:

But less than five months later, a nearly forgotten word has crept back into Times executives’ vocabulary: profit. “On a month-to-month basis, we are starting to operate in the black,” Mr. Blethen, who is also chief executive of The Seattle Times Company, said in an interview last week.

How much black ink and by what measure, the privately held company will not say, and amid a sharp advertising downturn, no one denies that its situation remains precarious. But The Times has improved its prospects by picking up most P-I subscribers and managing to keep them so far. It says its daily circulation rose more than 30 percent, to more than 260,000 in June, from about 200,000.

Oddly enough, what remains of The P-I is also faring better than expected. The Hearst Corporation kept the paper’s Web site alive as a news operation with a small staff, heavily reliant on more than 200 unpaid bloggers who write on things as diverse as their neighborhoods, cooking and marathon running.

Last week News Corp. announced a $203 million loss and a move toward requiring users to pay for all content online, the Financial Times is toying with several pay models but the centerpiece appears to be a pay per article system: currently offers three tiers of access to its digital content. For users who register an amount of personal information, such as their email address, 10 articles a month are accessible free of charge. There are about 1.4 million registered users of for this limited access.

An online subscription costs £150 a year, or £199 for a premium-level service that includes added content such as the Lex column . . .

“We are looking at pay per view and we do want to offer users the broadest range of options for accessing FT content on the website,” said the managing director, Rob Grimshaw. “We will progress with pay-per-view sometime over the next 12 months” . . .

However, speaking to the Guardian yesterday, Grimshaw said that it was of paramount importance to have a simple, easy payment system as had been successfully introduced by Amazon, with its “one-click” service, and iTunes.

In addition, last week, Borrell Associates said that it foresaw a modest recovery in newspaper ad revenues:

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Despite their loss of favor among techies, newspapers remain a highly trusted advertising medium among most consumers (per Nielsen, 4/09)

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Finally, here are some new metrics from the NAA (based on data collected by MORI research and Nielsen):

  • Newspaper Readers Seek Out Advertising Content: Nearly six in 10 adults (59 percent) identify newspapers as the medium they use to help plan shopping or make purchase decisions.
  • Newspaper Readers are Involved: 41 percent of U.S. adults say newspapers are the medium used most to check out ads – more than radio TV, Internet, magazines and catalogs combined.
  • Newspaper Readers Take Action: 82 percent of U.S. adults took some action as a result of a print newspaper ad in the past 30 days: 61 percent clipped a coupon, 50 percent bought something advertised and 52 percent visited a store.
  • Newspaper Readers Value Insert Advertising: 73 percent of adults regularly or occasionally read newspaper inserts, and 82 percent have been spurred to action by a newspaper insert in the past month.

RHD Posts Q2 Earnings

August 4, 2009

Picture 22YP publisher RH Donnelley this afternoon announced Q2 earnings:

R.H. Donnelley Corporation . . . reported second quarter 2009 net revenue of $566 million, representing a 15 percent decline from second quarter 2008. Adjusted EBITDA(1) in the quarter was $293 million, down 20 percent from second quarter 2008. Adjusted free cash flow in the quarter was $164 million – based on cash flow from operations of $121 million, capital expenditures of $6 million and $49 million related to reorganizational, restructuring and restricted stock unit payments – up from $159 million in second quarter 2008, primarily due to the termination of bond interest payments while in bankruptcy. Second quarter advertising sales were $523 million, down 23 percent from advertising sales in the second quarter 2008. Net loss was $75 million in the quarter compared to a net loss of $339 million in second quarter 2008.

“Second quarter advertising sales were $523 million, down 23 percent from advertising sales in the second quarter 2008.”

Here are the filings for those who want to dig deeper.

Good News, Bad News in WashPo Q2

August 2, 2009

Picture 2Here’s the earnings release from Friday. Revenues were down but the quarter saw a profit for the company overall; newspapers were down:

The Washington Post Company today reported net income of $11.4 million ($1.30 earnings per share) for its second quarter ended June 28, 2009, compared to a net loss of $2.7 million ($0.31 loss per share) for the second quarter of last year . . .

Revenue for the first half of 2009 was $2,182.6 million, up 1% from $2,169.4 million in the first half of 2008, due to increased revenues at the Company’s education and cable television divisions, offset by revenue declines at the Company’s newspaper publishing, magazine publishing and television broadcasting divisions. The Company reported an operating loss of $13.4 million for the first half of 2009, compared to operating income of $71.7 million for the first half of 2008 . . .

Newspaper publishing division revenue totaled $168.8 million for the second quarter of 2009, a decrease of 14% from $197.3 million in the second quarter of 2008; division revenue decreased 18% to $329.7 million for the first six months of 2009, from $403.4 million for the first six months of 2008. Print advertising revenue at The Post in the second quarter of 2009 declined 20% to $80.0 million, from $99.8 million in the second quarter of 2008, and decreased 27% to $154.3 million for the first six months of 2009, from $211.4 million in the same period of 2008. The print revenue decline in the second quarter of 2009 is due to large decreases in classified, zones and general advertising; the decline in the first half of 2009 includes similar declines. Revenue generated by the Company’s newspaper online publishing activities, primarily, declined 9% to $23.5 million for the second quarter of 2009, versus $25.9 million for the second quarter of 2008; newspaper online revenues declined 9% to $45.6 million in the first six months of 2009, versus $49.8 million for the first six months of 2008. Display online advertising revenue grew 2% for the second quarter and first six months of 2009. Online classified advertising revenue on declined 29% and 26% for the second quarter and first six months of 2009, respectively.

For the first six months of 2009, Post daily and Sunday circulation declined 1.5% and 2.6%, respectively, compared to the same periods of the prior year. For the six months ended June 28, 2009, average daily circulation at The Post totaled 622,700 and average Sunday circulation totaled 858,100.

Newsweek also saw significant revenue declines:

Revenue for the magazine publishing division totaled $45.5 million in the second quarter of 2009, a 27% decrease from $62.7 million in the second quarter of 2008; division revenue totaled $91.6 million for the first six months of 2009, a 21% decrease from $116.1 million in the first six months of 2008. The decline is due to a 40% and 32% reduction in advertising revenue at Newsweek for the second quarter and first six months of 2009, respectively, resulting from fewer ad pages at both the domestic and international editions. In February 2009, Newsweek announced a circulation rate base reduction at its domestic edition, from 2.6 million to 1.5 million, by January 2010. Q2 Results Excerpts

July 31, 2009

Picture Q2 results came out yesterday: “the company expects revenue to be between $13.4 and $13.7 million, exceeding the high end of its prior guidance of $13.2 million.”

Here’s are more non-financial details that went out with the release (verbatim):

  • Record Traffic – The company reached record traffic of 63 million monthly unique visitors (MUVs) on the site and network during the second quarter of 2009, up 5% from 60 million MUVs during the first quarter of 2009, and up 31% from 48 million MUVs during the second quarter of 2008.
  • Organic Traffic – Organic traffic also reached an all-time high, exceeding 29 million monthly unique visitors on the site and network during the second quarter of 2009, up 7% from 27 million during the first quarter of 2009, and up 61% from 18 million during the second quarter of 2008.
  • Advertisers – We ended the second quarter of 2009 with over 27,000 subscription customers compared to nearly 30,000 at the end of the first quarter of 2009 and 5,000 at the end of 2008.
  • Private Label Partnerships– In June 2009, the company announced partnerships with The Dallas Morning News and The Press Enterprise to power local search on the companies’ web properties. The company currently partners with over 700 regional media sites.
  • Technology Licensees – The number of licensees for the company’s local search technologies grew to 63 during the second quarter of 2009, up from 48 in the first quarter of 2009.

NY Times Revenues Down, Profit Up

July 23, 2009

The NY Times Co. announced earnings today, revenues are down but the quarter was profitable:

The New York Times Company announced today second-quarter 2009 operating profit of $23.3 million compared with $40.3 million in the second quarter of 2008. Excluding depreciation, amortization, severance and a pension charge as noted below, operating profit was $66.1 million in the second quarter of 2009 compared with$100.5 million in the second quarter last year.

In the second quarter earnings per share were $.27 compared with earnings per share of $.15 in the second quarter of 2008 . .

Total revenues decreased 21.2 percent to $584.5 million from $741.9 million primarily due to lower print and online advertising. Advertising revenues decreased 30.2 percent; circulation revenues rose 1.5 percent

Internet businesses include,, and other Company Web sites. Total Internet revenues decreased 14.3 percent to $78.2 million from $91.3 million, and Internet advertising revenues declined 15.5 percent to $68.0 million from $80.5 million. Internet advertising revenues at the News Media Group decreased 21.6 percent to $42.1 million from$53.7 million. In total, Internet businesses accounted for 13.4 percent of the Company’s revenues in the second quarter versus 12.3 percent in the 2008 second quarter.

There was a profit of $39.1 million vs. $21.1 million a year ago.

Is this good news? Or is it simply effective cost containment amid declining ad revenues, which can be expected to continue to decline? There are clearly half-empty, half full competing interpretations running around this morning. As of this hour, shares are up however:

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AT&T Q2 Directory Results

July 23, 2009

AT&T reported better than expected Q2 results this morning. I break down the wireless portion at LMS.

However the directory results are really buried, not in the release or the earnings slides. I found them in the XL spreadsheet associated with the earnings:

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AT&T has no need to spin out the directory business, but it potentially could at some point. It sees the sales force as strategic but directory isn’t a growth business and it’s small compared to other segments. Announces Traffic, Results

July 15, 2009

Last week LoPicture put out a release about its growing traffic:

The company reached record search traffic of 63 million monthly unique visitors (MUVs) on the site and network during the second quarter of 2009, up 5% from 60 million MUVs during the first quarter of 2009, and up 32% from 48 million MUVs during the second quarter of 2008.

Organic traffic also reached an all-time high, exceeding 29 million monthly unique visitors on the site and network during the second quarter of 2009, up 6% from 27 million during the first quarter of 2009, and up 57% from 18 million during the second quarter of 2008.

And today the company released preliminary Q2 financials: Corporation, a leading local search site and network, today announced that based on unaudited preliminary results for the three months ended June 30, 2009, the company expects revenue to be between $13.4 and $13.7 million, exceeding the high end of its prior guidance of $13.2 million.

My understanding is that roughly half the traffic is organic and half is paid. It’s not clear what percentage the network contributes.

Borrell: 20% of Social Nets Ad Dollars Local

July 15, 2009

While I was gone Borrell put out an ad spending projection that contends social networks will see 20% of their ad dollars come from the local (read: SMB) market:

We just did an assessment of advertising placed on social networking sites and were surprised to find that nearly 20% of all ad spending is by local businesses. Our assumption going into this research was that commercials on social networks were almost purely national. We’re estimating that local advertisers will account for about $641 million of nearly $3.3 billion this year trying to reach consumers via these sites.

Borrell’s list of social networking sites is long but there are only three sites that matter in the big picture: Facebook, Twitter (no ads now) and MySpace (although MySpace is fading). Maybe AOL will do something with Bebo and local that is interesting in the future, given that AOL is making a renewed effort in local. There may be other isolated sites that matter here and there for specific industries or verticals.

Problems/issues/questions with this estimate:

  • It’s extrapolated from a small base
  • Most of the “action” on social networks among SMBs cannot be considered “advertising” (e.g., Facebook profiles, fan pages)
  • What’s a “social network”? We all know the top sites but definitions get murky when one gets farther “down” the ladder.

I agree that there will continue to be lots of focus and energy among SMBs directed to social networking sites — Twitter and Facebook in particular. The challenge for these sites is how to build functionality that both benefits SMBs and can generate revenue. The various flavors of “advertising” on Facebook are not as useful as the free tools. And Twitter effectively has no ads.

There is, however, a substantial opportunity for third parties, SEM firms and directory publishers in particular to add Twitter and Facebook tools (and reach) into their product set to add value to what they’re providing to advertisers. Some are contemplating or already doing versions of this. Agendize, for example, does extends directory publisher reach with its toolset.

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Source Borrell Associates (n=118)


Related: From MediaPost . . . Most of the 2008 revenue forecasts proved to be terribly wrong:

A survey of eight revenue forecasts issued between June 2007 and December 2008 (from Veronis Suhler Stevenson, Jupiter Research, the Kelsey Group, Lehman Bros., Magna, eMarketer, J.P. Morgan, and ZenithOptimedia) reveals that, on average, the crystal ball for Internet advertising revenue growth in 2008 was about 100% higher than the actual growth rate, with an average prediction of 20% versus actual growth of just 10%, according to the Interactive Advertising Bureau. Midway through 2009, it seems likely the forecasts will be even further off. On average the analysts predicted 17.5% growth in Internet revenues, but the first quarter actually saw negative growth with a -5% drop. True, the rest of the year could see a recovery – but to yield an annual growth rate of 17.5% Internet revenues would have to grow an average 25% in the second, third, and fourth quarters.

Borrell: Local Online Spending May Be Up

June 30, 2009

From a blog post by Gordon Borrell:

[W]e may have been far too conservative earlier this year when we projected that local online advertising would grow 8% in 2009. At the end of the first quarter, the increase looked closer to 11% . . .

Phenomenal as it may seem, we’re getting data indicating triple-digit growth for some companies selling interactive advertising. These are definitely the “get it” companies that have hired dedicated sales forces and are plowing ahead with the products advertisers are buying. We aren’t, however, seeing triple-digit growth from companies that continue to labor under the delusion that “convergence sales” is a viable strategy.

Right now we’re pegging local online advertising at $14.03 billion, up from our estimate of $13.3 billion issued back in January.

This may indicate something of an “inflection point” motivated by the recession in part. But it would also appear to be driven by competition among local media companies and independent sales channels. Any comments Gordon?

RHD Files for Chapter 11

May 29, 2009

Picture 1RH Donnelley, parent of Dex and and one of the four major US YP publishers, has confirmed what was long-anticipated by many and filed for Chapter 11 bankruptcy protection. From the Marketwatch report:

Shares of Cary, N.C.-based R.H. Donnelley closed Thursday at 14 cents a share, off by 6.7%. The stock has had a tragic run, peaking at around $78 in 2007 before plunging on signs the economy was beginning to cool off.

R.H. Donnelley said it has already reached an agreement in principle with key creditors to reduce its debt by around $6.4 billion, eliminate roughly $500 million in annual interest expense and extend the company’s bank maturities out to 2014 . . .

Since 2000, R.H. Donnelley has rung up more than $12 billion in acquisitions, including its $9 billion buyout of Dex Media, which included about $5 billion in debt. The company also purchased Sprint Directory Publishing and certain businesses of SBC Communication Inc.

Last year, the company swung to a $2.3 billion loss from a profit of $46.9 million, primarily due to non-recurring items. Total revenue came in at about $2.6 billion.

Idearc also previously filed for a “pre-packaged” bankruptcy to restructure its debt. Absent the debt these directory companies are still generating lots of cash and fairly healthy margins though revenues have been in decline to varying degrees, generally in the low double-digits.

Yellowbook’s parent Yell has been under tremendous pressure in the UK. Only AT&T’s yellow pages, buried within the larger corporate structure is shielded somewhat from these same pressures and concerns, though the print business there is also under similar revenue pressure.

IAB FY 2008 Revs $23B

March 30, 2009

Just out today from the IAB:


Search is up, classifieds down.

Marchex, Q4 & FY Revenues

February 19, 2009

Both Marchex and reported Q4 and full year revenues today. The releases are linked to the company names. I’ve pulled out a few bits from each release.


Operating Highlights

Local Advertising Services: For the fourth quarter of 2008, revenue from Local Advertising Services was $16.7 million. Following the migration of a legacy Voice Services customer during the fourth quarter, consistent with the commentary provided by the company in the third quarter, Marchex ended the fourth quarter with more than 70,000 advertisers using its products and services. Pro forma for this Voice Services account migration, Marchex added to the total of advertisers using its products and services on a net basis in the fourth quarter. While it is more difficult to predict advertiser growth rates in the current economy, Marchex expects to add thousands of new advertisers in 2009.

Publishing (proprietary traffic sources, formerly referred to as Marchex’s Local Search Network): For the fourth quarter of 2008, revenue from Publishing was $18.1 million. Additionally, Marchex attracted more than 27 million unique visitors for the month of December 2008 and delivered more than 170 million revenue-generating events and referrals in the fourth quarter. Unique visitor statistics are based on internal traffic logs, which calculate unique IP (Internet protocol) addresses on an unduplicated basis during a given month.


Fourth Quarter Operating and Recent Highlights:

  • Redesigned Website – In early February, the company launched a redesigned interface for The new site was designed to further improve the consumer search experience.
  • Monetization of Traffic – Revenue per thousand visitors (RKV) was $275, up 40% from $197 RKV in the fourth quarter of 2007 and down 1% from $278 RKV in the third quarter of 2008.
  • Overall Search Traffic – The company reported search traffic of 51 million monthly unique visitors (MUVs) on the site and network during the fourth quarter of 2008, up 57% from 32.5 million MUVs during the same period in 2007.
  • Organic Search Traffic – The company reported organic search traffic of 26 million monthly unique visitors on the site and network during the fourth quarter of 2008, up over 200% from 8.5 million during the same period in 2007.
  • Acquisition of Web Hosting Customers – On February 18, the company acquired approximately 11,800 web hosting customers for approximately $1.2 million. The transaction is expected to be accretive immediately.
  • Direct Advertiser Base – Billable advertisers numbered 5,100 as of January 31, 2009.
  • Technology Licensees – The number of licensees for the company’s local search technologies grew to 40 during the fourth quarter of 2008, up from 37 in the third quarter 2008.
  • Launched Local Mobile™ on Virgin Mobile USA – In November, the company announced the launch of Local Mobile™ on Virgin Mobile USA’s nationwide network. Virgin Mobile USA’s more than five million customers can now leverage the power of Local Mobile directly from all 3G Virgin Mobile USA handsets.
  • Partnered with Valpak for Online Coupons – In December, the company announced an agreement with Valpak, a leading coupon and direct marketing provider, to distribute local business offers throughout the network.

Trulia in Co-Brand Deal with WashPo

February 11, 2009

picture-181This morning Trulia is announcing that it will become a partner with the, bringing its search and listings, as well as other content, to the real estate section of the newspaper site. The deal won’t be implemented until April however, presumably the end of the contract with current partner HomeFinder (owned by Classified Ventures).

This latest deal is part of Trulia’s Publishing Platform program that brings Trulia content and functionality to third party sites. Also using the platform are:

  • St. Petersburg Times
  • The Bakersfield Californian
  • Press of Atlantic City
  • The Charleston Gazette
  • The Sun Chronicle
  • The Citizen Tribune
  • US News
  • Kiplinger
  • Belo TV sites

However the WashPo deal is the highest profile one to date for Trulia.

I spoke briefly yesterday with CEO Pete Flint about the state of Trulia and the specifics of the deal. He said that Trulia had seen its best month ever in terms of traffic in January. Flint told me that revenue growth has been good — especially in a down economy where the bursting of the real estate bubble was the trigger for the collapse.

Trulia also expects to be profitable in the near term, which is another remarkable thing for a “startup” in a bad economy.

Trulia has dramatically evolved since its launch. In the beginning the site was conceived as a crawler that would bypass traditional real estate listings sources. Later it began taking feeds directly from brokers. Now the site is also working with MLSs. Flint said that this was to make coverage more comprehensive.

Most “Web 2.0” sites are now largely toast, although the features of Web 2.0 live on (e.g., user-generated content). Many people may take issue with this statement but my view is that Trulia is one of the few “Web 2.0” sites to succeed. Trulia competitor Zillow (which has raised much more money than Trulia) is also in that camp and succeessful in terms of visibility and traffic — though probably farther from profitability.

eMarketer Online Ad Spending Numbers

November 25, 2008

Based on a mix of data sources, including IAB/PwC, here’s the company’s aggregation/forecast of online ad spending by category: