CitySearch Paid Listings Revenue Rises 37 Percent
"Everything superlative that you read about paid search is eventually going to be true in the local space," IAC CEO Barry Diller told investors in a conference call yesterday.
IAC's local services unit, which includes CitySearch, online invitation service Evite and coupon-book marketer Entertainment Publications Inc., brought in $32.1 million and lost $27.8 million on an operating basis. The results included EPI, acquired in March 2003. Without EPI, local services revenue was $5.8 million with a $17.1 million operating loss.
CitySearch began its paid listings program last March, allowing local restaurants and bars to bid for pay-per-click listings tied to user searches.
The ad program appears to have picked up speed. In the fourth quarter it grew 14 percent, and the first three months of the year the growth rate expanded to 37 percent sequentially.
Diller said CitySearch and EPI have a combined 80,000 advertisers. He did not break out CitySearch's advertiser base. It ended 2003 with 25,000 advertisers.
He downplayed the possibility of IAC buying a search engine to bring widespread distribution to its disparate online brands, which include travel sites Expedia and Hotels.com, dating sites uDate.com and Match.com, plus Ticketmaster. Diller once nearly bought Lycos for $18 billion; the portal's owner, Terra Lycos, now is reportedly shopping it for $200 million.
"We think that so long as these brands are strong and getting stronger that people are going to connect with them directly," Diller said. "I don't really think we need a national portal or national distribution to, so to speak, help our brands."