Collision Course: The Battle for Revenue between Newspaper Audiotex Services and Talking Yellow Pages Is Heating Up

By Fitzgerald, Mark | Editor & Publisher, October 12, 1991 | Go to article overview

Collision Course: The Battle for Revenue between Newspaper Audiotex Services and Talking Yellow Pages Is Heating Up


Fitzgerald, Mark, Editor & Publisher


Collision course

The battle for revenue between newspaper audiotex services and talking yellow pages is heating up

When yellow pages publishers talk about their industry nowadays, they sound a lot like newspaper publishers.

They worry, for example, about their inability to attract national advertising because there is no way for a big advertiser to make multiple ad buys with a single order and a single bill.

They see their relatively high-margin publishing business threatened by more targeted media because they just have not developed consumer and marketing databases worthy of the name.

They feel electronic competitors breathing down their necks with a seemingly limitless arsenal that includes technologies that cannot even be imagined today.

Finally, like newspapers, they worry that their once-robust readership growth faces a permanent decline.

"Market trends in consumer usage, local account penetration, price elasticity of demand, and real revenue growth indicate that today's yellow pages product has matured," warned J. Raymond Avedian, president and chief executive officer of the Yellow Pages Publishers Association.

"We are a mass-marketing medium in an environment where mass marketing is becoming less important," said Earl B. Mix Jr., vice president of national markets for US WEST Direct.

When Mix made that comment at a recent conference on Talking Yellow Pages, the executive from one of the regional Bell operating companies (RBOCs) sounded for all the world like a newspaper publisher issuing a similar lament.

Indeed, one clear theme that emerged from the two-day gathering of top yellow pages publishers, RBOC executives and audiotex experts is that those similarities between newspapers and yellow pages means their already fierce competition will simply continue in an additional medium: audiotex or, to use the more popular term, talking yellow pages.

Underscoring that theme were several trends that emerged in discussions:

* Newspapers are aggressively entering both audiotex and traditional yellow pages businesses.

"I think the greatest single threat to directory revenue could be newspapers that are marketing their own directories all around the country," said John F. Kelsey III, managing director of the Princeton, N.J.-based Audiotex Group.

Gannett Co. alone, for example, already publishes 50 yellow pages directories.

* Newspapers have managed to get a head start over yellow pages publishers on audiotex.

"Newspapers have voice technology in more markets than the yellow pages do," Kelsey said.

* Newspapers are also grabbing the lead in defining for the consumer what to expect from audiotex.

"Newspapers are positioning themselves as the heirs apparent of voice interactive [systems] -- and they will be unless yellow pages publishers take an aggressive position quickly to set up [technical] standards and in setting up a clearinghouse to rep [sell] national advertising," said John Collins, president of Electronic Media Publishing, one of the pioneers in talking yellow pages.

* Newspapers are now looking at audiotex as a way to make money rather than as merely a defensive move against electronic competition.

* And newspapers are using audiotex as another weapon in continuing campaigns to sell against printed yellow pages directories.

For example, general manager Gordon Borrell described how his Landmark Information Services, a subsidiary of the big newspaper publisher, Landmark Communications, used its Infoline audiotex in a campaign that took $970,000 worth of advertising away from Atlantic Bell's Yellow Pages directories. About $100,000 of that money went to Landmark newspapers, he said.

These trends emerged at a conference on talking yellow pages that was held in Chicago recently and co-sponsored by the Audiotex Group and the Yellow Pages Publishers Association. …

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