Prodigy Seeks Investor for Online Classifieds Division

By: Steve Outing

Prodigy Inc. is seeking an investor for its online classifieds division, it has been learned. The U.S. online services company, which recently merged with International Wireless Inc., offers a turnkey electronic classifieds system for use by newspapers. Among its customers is the giant Southam newspaper chain in Canada.

According to Prodigy classified ads product manager Tony Witek, the company is hunting for a partner to invest in the classifieds venture, which employs a staff of nine. The motivation is simply to find more money to put into the business to keep it growing and to remain competitive with a growing number of players in the electronic classifieds market. The company "believes in this business," but requires additional capital, he says.

Witek acknowledged the possibility of an investor buying the whole operation, but said that finding a joint partner is the preferred option. He could not say what companies Prodigy has been talking with, but speculation among managers at newspapers that use the Prodigy classifieds system is that Canadian media giant Thomson will be the one.

Prodigy newspaper customers have been told that there will be no change in services provided.

Prodigy was one of the first companies to develop a solution for online presentation of classifieds, when it developed its AdTronix system in 1993 for use by newspapers then operating on the Prodigy proprietary network. AdTronix was introduced for the World Wide Web in September 1995, with the Houston Chronicle as its first customer. The system is now in use as well by Newsday (Long Island, New York) and the Tampa Bay (Florida) Tribune, and soon the Providence (Rhode Island) Journal.

The company's biggest deal is to put the classifieds of 17 of Southam's Canadian newspapers online by the end of the year. Five of the papers are already operational.

Prodigy licenses its online classifieds system to newspaper publishers, who provide their classifieds to be hosted on Prodigy's servers. Newspaper classifieds sites look like they are the newspaper's, with a small Prodigy logo appearing at the bottom of the Web page. The system takes classifieds from a paper's front-end system and converts them to HTML presentation. It features a sophisticated search engine; supports sound, photos and video in ads; and offers advanced features such as an "Ad Alert" e-mail notification service that tells consumers when an ad matching their preferences enters the newspaper classifieds database. The system does not offer print display ad conversion for Web presentation.

Contact: Tony Witek,

Wall Street Journal doing well with paid subscriptions

You probably saw the news earlier this week that the Wall Street Journal Interactive Edition is reporting 30,000 paid subscriptions to its service, since dropping free access to the site on September 21. That's great news, since no newspaper that has experimented with paid Web services has experienced numbers that large. While still a trifle compared to the Journal's print circulation of 1.8 million, this is promising since the numbers grew quickly.

The site also has about 100,000 still non-paying subscribers who access the Journal using the Microsoft Explorer Web browser. The Journal has worked out a deal where Explorer users get to access the site free through December. It also gives new users a free two-week trial. That so many people are paying for the service when they could get it free for a few more months by using a different browser indicates to me the strength and appeal of the Journal's service. It's also evidence that business people are willing to pay for worthwhile content on the Web. (The Journal has this advantage over other newspapers online that appeal to a more general audience.) It will be interesting to watch the Journal's paid Web subscriber numbers following the end of the Explorer free-use period.

The Interactive Edition is getting between 32,000 and 35,000 visitors each day, compared to a peak of 40,000 daily during the free trial period. Of the Web paying subscribers, less than 40% also subscribe to the Journal print edition.

The Journal Interactive Edition also recently received two awards from the Information Industry Association in its "HotShot" competition, in the best news service and best Web site/professional categories.

Focus group of 10-year-olds in the UK

Here's another periodic report from my colleague from England, newspaper industry new media consultant Colin Brannigan:

"The major English regional papers are at last getting serious about the Web. The first major player with a dedicated Web site is Eastern Counties Newspapers based in Norwich. The site has just launched after six months' planning and testing. Preparations sensibly included focus group work with children. These were 10-year-olds who were invited to sessions to talk about computers and their interests. Nine out of 10 children had computers at home and more than one-third already had Internet experience. They were taken on a tour of top sites including Virtual Stonehenge, NASA, Virtual Hawaii and the White House. One group of children e-mailed Hilary Clinton's office and received a reply within 20 minutes!

"Eastern Counties Newspapers is part of the AdHunter consortium in the UK, a group of eight publishers planning to pull together all their classifieds from more than 500 newspaper titles. It is intent on developing content and services which are separate from the newspapers, so much so that they have called their site Eastern Counties Network rather than Eastern Counties Newspapers (their parent title). As group chief executive Douglas Bird puts it: 'We are producing an online service, not a newspaper online. That is why we have established Eastern Counties Network with its own staff, budget and operational objectives. Payback will be medium term. We already see many new competitors arriving, providing content which was thought to be the preserve of local papers.'"

Contact: Colin Brannigan,

PoliticsNow adds newspaper coverage

U.S. political Web site Politics Now has announced several new content partnerships, including with two newspapers, the San Jose Mercury News' Mercury Center Web service and the International Herald Tribune. Mercury Center will provide coverage of election issues that impact the high technology industries; the Herald Tribune will offer coverage of American politics from newspapers around the world, including Hong Kong's South China Morning News, Canada's Globe and Mail, France's Le Monde, Israel's Jerusalem Post, Japan's Asahi Shimbun, Spain's El Pais, Saudi Arabia's Arab News, Mexico's El Universal, Brazil's O Globo, and Sweden's Dagens Nyheter.


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