By: Carl Sullivan
Belo, Media General, others take equity positions
AdOne LLC of New York has six new major newspaper company investors that have agreed to take equity positions. This brings the online classifieds company’s backers to a total of 11 of the newspaper industry’s largest concerns.
The new investors are A.H. Belo Corp., Journal Register Co., Lee Enterprises Inc., Media General Inc., Morris Communications Corp., and Pulitizer Inc. The existing investors/owners are Advance Publications, Donrey Media Group, Hearst Corp., MediaNews Group, and E.W. Scripps Co., which collectively acquired AdOne in January as equity partners.
AdOne runs ClassifiedWarehouse.com, an aggregator of newspaper classified ads on the Web. The company claims to be the largest network of employment, automotive, and real estate online classifieds. Currently, over half a million ads run on the network each day.
AdOne is also the premier classifieds partner to Lycos, which gives newspaper classifieds increased visibility. The combined Web properties of Lycos are among the most visited sites on the Web.
“AdOne is becoming a real powerhouse in online classifieds,” says Peter M. Zollman, a consultant with Advanced Interactive Media Group.
Brendan Burns, AdOne president and CEO, says the deal brings significant financial and promotional resources to the company. “The partners have collectively agreed to very large promotion commitments in this deal,” he says. The new investors will increase AdOne’s circulation in the top 10 U.S. markets to more than 7 million, and in the top 200 markets to nearly 24 million, the company says.
Among larger newspapers, the announcement increases AdOne’s strength against Classified Ventures Inc. of Chicago, which has the backing of eight large media companies, including Gannett Co. Inc. and Knight Ridder. “AdOne and AdQuest3D [a competitor offered by PowerAdz.com of Rensselaer, N.Y.] have proven they can get newspapers online quickly, while Classified Ventures is languishing, struggling to launch its affiliates,” Zollman says.
Burns emphasizes that the new investors make AdOne and its newspaper partners a much more formidable opponent against non-newspaper classified concerns like Yahoo!, Classifieds2000, and vertical sites like CarPoint and Monster.com.
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