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Many Independent City Sites Generating Six Figure Revenues

(November 30, 2005) Traditional media and news resources are facing a new crop of competitors. According to Research and Markets, Independent local Web sites have gained steam, rejecting the popular business model of loading up a site with news, weather, sports and classified listings. Their strategy of offering simple Web sites that focus on entertainment and recreation has many of them generating revenues well into six-figures.

Feverish growth in online advertising has spawned a new crop of local Web site competitors. They are elbowing in on territory that traditional local media properties have been trying to stake out for the past decade, but they are using a decidedly different model. Rather than fill the site with repackaged local news headlines, obituaries, or weather reports, these independent local sites focus almost exclusively on fun and interesting things to do around town. While local media home pages in San Francisco lead their pages with crime news and updates from Iraq, leads with nightlife, dining and attractions.

The strategy is apparently beginning to pay off. Many independent local sites are reporting revenues well into six figures, with respectable margins. In fact, about 20 owners of URLs banded together recently to form their own trade association.

A flurry of acquisitions has begun as well. recently secured a $20 million investment that it will use in part to buy, a large network of city guides. Boulevards New Media, a network of 90 city sites, paid $500,000 for a URL. And a Las Vegas newspaper publisher offered $12 million for

Independent sites tend to have a fraction of the traffic and revenue of competitors who are financed and promoted by traditional-media outlets, but the underdogs offer an interesting lesson: Keep it simple, keep it upbeat, and don't forget the out-of-market traffic. They are focusing on sites that win attention from locals and travelers alike, and are tapping ad revenues from some of the largest spenders on interactive advertising: hotels, casinos, airlines, real estate agents, resorts and restaurants.