Microsoft's local city guide, Sidewalk, will announce several new national and regional advertisers today: BankBoston, Bantam Books, Holland America Line, Nasdaq, Norwest Bank, Recreational Equipment and Sears, Roebuck & Co. The advertisers signed one-year contracts with Sidewalk for national sponsorships that can also target consumers locally in each of Sidewalk's nine U.S. markets, including New York, San Francisco, Boston and Seattle. The service launched last April.
The market for online advertising for city guides is competitive among Sidewalk, CitySearch, Digital City, a joint venture between America Online and the Tribune Co., and others. While the services offer different content, all are clamoring for the same group of local advertisers. Local online advertising should hit about $19 million this year, according to Forrester Research.
Though Peter Atkins, director of advertising for Sidewalk, stressed Microsoft is not looking to steal classified revenue from the newspaper industry, online advertising in this area is typically viewed as competition. "The Internet is not going to affect other media forms," Atkins insisted. "Advertisers advertise in lots of different mediums. Each medium has specific benefits. Sidewalk targets a message locally by community, reaching the right customer."
Whether or not local online ad dollars begin to take money out of other media, there is reason to believe that the many local online venues may begin to battle each other.
In New York, for instance, an already-crowded local content marketplace will soon see the launch of New York Today, a joint venture between The New York Times and Zip2, a technology company that partners with newspapers to develop their Web sites. New York Today will be more utilitarian than the entertainment-oriented Sidewalk, since it is geared toward coping with life in New York. However, it bears similarity to CitySearch in that the service will create Web sites for local advertisers.
"We have long-standing relationships with big and medium advertisers in New York," said Dan Donaghy, general manager of New York Today. "A lot of those advertisers will choose to do business with a partner they know."