New York Times - February 15, 2008
4 News Companies Ally to Sell Ads on the Internet
By LOUISE STORY
Four large newspaper companies are joining forces to sell advertisements on the Internet, hoping that the combined heft of their Web sites will encourage large advertisers to spend more money.
Each of the four companies — the Tribune Company, the Gannett Company, the Hearst Corporation and The New York Times Company — is transferring a portion of its online ad space to quadrantONE, a new company that will be announced Friday.
The purpose of the joint venture, which will be based in Chicago and will hire 17 people, is to let national advertisers place ads on local Web sites with a single phone call. The sites belong to papers like The Los Angeles Times (which is a Tribune property), The Des Moines Register (Gannett), The Houston Chronicle (Hearst) and The Boston Globe (The New York Times Company).
Some of the companies’ flagship sites, however, will not be included, because they are not considered local. These include the sites of USA Today, a Gannett paper, and of The New York Times and The International Herald Tribune, which are owned by the Times Company.
In total, quadrantONE will be able to reach about 50 million unique visitors a month, its executives said, citing Nielsen Online data.
The effort is at least the third in the last decade involving major newspaper companies joining forces to sell online ads. But quadrantONE comes as newspaper companies are being wooed by companies like Google, Microsoft and Yahoo, which would like to sell premium ads on the newspapers’ sites.
“We want to control our own destiny,” said Lincoln Millstein, senior vice president for digital media at Hearst Newspapers.
Executives involved said the newspaper companies understand the local market better than Google, Yahoo and Microsoft and can best help national advertisers place their messages on local sites.
But not everyone agrees.
“I don’t think the alignment of newspaper companies will solve the issue,” said Shar VanBoskirk, an analyst who covers online advertising at Forrester Research. “They need that alignment with a technology company that will bring them the set of skills that they need to monetize their content.”
Several of the newspapers involved in quadrantONE are part of Yahoo’s newspaper consortium, which provides advertising technologies and sales, and all of the companies are partial owners of the Newspaper National Network, a network that allows national advertisers to place ads across thousands of papers’ print editions and, more recently, Web sites. The companies were also all part of the New Century Network in the late 1990s, which failed.
Executives at the newspaper companies said quadrantONE will fare differently because it will have a central repository of advertising inventory, and thus will not have to call the newspapers individually to fill each order.
The group is inviting other newspapers to submit ad inventory, though not to join as owners.