By Jared Chausow
By Katie Toth
By Elizabeth Flock
By Albert Samaha
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By Jon Campbell
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They'll enter a market crowded with the New York branches of empire builders CitySearch and Microsoft Sidewalk, and online ventures from Gotham standbys like the Daily News and The Village Voice, which also has a deal to provide listings to Sidewalk. (The New York Postand New York magazine are sticking closer to their traditional missions online, and Time Out New York has a partnership with CitySearch.) Several niche-oriented Davids also walk among the Goliaths: the edgier New York Now and Total New York (which is owned by Digital City Studio but will remain a separate site), the Downtown-centric Golden NYC, and the tips-focused New York CityInsider.
There's a significant demand for local information online--a recent report by research firm FIND/SVP revealed that half of Internet users would seek out information about their communities--but the sites will have to compete with New York's print media for local advertising. Because the Internet advertising market is still nascent, ''It looks like there's more players than there is an audience,'' says Stuart Gibbel, marketing communications manager for FIND/SVP.
Already, one player has partly opted out. New York Now recently changed its principal business model from advertising to selling technology to other local sites. ''Advertising on the Internet has a longway to go,'' says New York Now president and founder Alex Sheshunoff. ''There's just not a lot of money there yet.''
Industry observers expect online guides to swipe a sizable chunk of the classified advertising market. But with city sites running annual operating costs of between $2 million and $3 million a year during start-up, according to Forrester's Bill Bass, things will likely get worse before they get better. The question, he says, is ''Do they have enough money to last through the lean years?''
Deep-pocketed Microsoft is betting that its technological prowess and laserlike focus on its editorial mantra--providing consumers with information for ''insight, decision, action''--will give Sidewalk an edge. ''Everybody says, 'What am I going to do tonight?''' says New York Sidewalk executive producer Eric Etheridge. ''We're made for that. You can go bing-bing-bing on Sidewalk and find a movie time and a restaurant.''
While Etheridge has attracted A-list editorial talent, Sidewalk's concentration on service journalism has frustrated some staffers, and two producers have left in the past few months. ''They hired all these top people who very quickly found out [the writing] was going to be very rudimentary,''says a former employee of another city's Sidewalk site. ''Writers who have spent years honing their voices are in a job that's data entry.''
Sidewalk competitor CitySearch boasts branches in 11 cities, but its New York site has homegrown roots and aims to provide the kind of savvy New York sensibility it sees as a challenge for some of its competitors. ''We have more leeway with the personality we can put into it,'' says editor in chief Deanna Vincent.
Though they're late to the party, both Digital City New York and New York Today each bring a built-in audience. Says Dan Donaghy, generalmanager of New York Today, ''If I didn't have the brand,the space in the paper [to advertise the online service], and adatabase of 2.2 million users [who have registered for The New York Times Online], I'd be worried about being late to market.''
Silicon Alley insiders tend to dismiss America Online as the province of Peoria, but Digital City Studio cutits teeth running Total New York. ''We're going to havereally high-quality editorial that captures the spirit and texture andthe personalities of the city, which is one of the things Sidewalk hasdone a fairly poor job of,'' says Digital City Studio executive producer and Digital City New York editor Guy Garcia, who cofounded Total New York. ''It's always been competitive... [but] now it's really a network battle.''
That battle is likely to heat up further if the sleeping giants of traditional media start devoting more resources to the Web.''People that have high cost structures [like Sidewalk and CitySearch]...won't last long enough to build up everycity,'' says Bass. Whatever happens, at least one major player is likely to end up a loser. ''I can't imagine there will be four players in this market,'' says FIND/SVP's Gibbel.''I don't think they think that either.''