SBC and BellSouth, two of the largest telecoms and owners
of two of the largest directory publishers in the United States,
have joined together to acquire YellowPages.com, long coveted
as the best URL in the online directories business. The two
companies have made the strategic calculation that their long-term
success in the online directories business, or the directories
business overall, was to join forces to achieve greater scale
while sharing resources to reduce the cost of developing and
maintaining a competitive technology platform. One of the
greatest newfound efficiencies will come from owning a URL
that is a natural traffic engine. Terms of the deal were not
disclosed, but a number of sources have estimated the value
of the deal to be in the neighborhood of US$100 million.
separate deal that nonetheless suggests the possibilities
this acquisition creates, BellSouth last week announced it
has an agreement with the search engine Google to resell its
AdWords product to advertisers in BellSouths nine-state
territory, as well as those served by its Berry Co. subsidiary.
The deal is a strong example of the growing realization that,
at least for now, publishers and search engines are more suitable
as partners than direct competitors.