Tools for Competing With Microsoft, Digital City, et al

By: Steve Outing

Earlier this summer after attending the Connections 96 newspaper new media conference, I reported on a new company called KOZ inc., which was developing a World Wide Web product called the Community Publishing Solution. This week, KOZ announced its first customer, Atlanta-based Cox Interactive Media (CIM), the new media/Internet division of media conglomerate Cox Enterprises.

CIM will be implementing the "KOZ Community Publishing Solution" (CPS) in a dozen or so of Cox's U.S. markets during the next six months, starting out in October with Atlanta, where Cox owns the Atlanta Journal-Constitution. The CPS system allows community groups, clubs, teams or any community organization to easily publish information about their activities for access by their members or the community at large.

This is a significant concept because it allows a media company's Web site to truly open up to the community, allowing community organizations to contribute and publish information to an online service with minimal human intervention by the Web site staff. In theory, it allows a newspaper Web site to contain and maintain a very deep set of content that a small Web site staff could not do on its own. Community group members feed their content -- whether it be event listings, little league scores, homework assignments, dates for soccer practices, etc. -- into customized database applications. And the system facilitates online communication between members of the groups.

This is a much needed Web publishing tool, exactly because most publishers don't maintain large online staffs. And important to any newspaper new media venture, says KOZ's president, Harry Bailes, is establishing a connection with constituencies in the community. Pulling community organizations into a relationship with a newspaper online service will put the paper into a stronger position than the competition, he says.

The competition is here!

KOZ is worth noting in part because it is the first company that has devised a strategy for newspapers to do battle with the online city guide companies that are entering local markets -- Microsoft's "CityScape," Digital City Inc., CitySearch, AT&T Hometown Network, Intellipages, and several others. That's what Bailes wants publishers to consider: That there is an alternative to allying your newspaper with one of those companies and becoming a mere content provider to a new cyberspace entity that is in many ways competitive to your own online service (and the print product itself).

Says Bailes of the online city guide companies positioning themselves in local markets where newspapers are today dominant, "From an industry perspective, it has all the potential of being a war. There are going to be some winners and losers."

Nearly all of the online city guide companies are courting publishers these days, and some have had success signing on newspapers as content partners. But most of the media partner deals seen so far have been with smaller papers, or TV and radio stations. With the exception of the Chicago Tribune (whose parent, the Tribune Co., owns a 20% stake in America Online spin-off Digital City Inc.) being the media core of Digital City Chicago, most large metro dailies are turning down offers to work with the city guide companies.

(I'll quickly note that Microsoft is not yet talking about who it has signed up as media partners for CityScape. In my conversations with newspaper new media executives in recent weeks, however, I've been more likely to hear that a large paper has turned down an offer than to have accepted it.)

Savior for big metros?

Bailes says KOZ has been focusing on the larger metro dailies as potential customers for CPS and its Web publishing products, and they've been the most receptive to the pitch. After all, the big metros have the most to lose when a company like Digital City creates a community online service that will diminish the role of the dominant local newspaper. Newspapers need to put up a fight, Bailes says. Predictably, he urges publishers not to align with the CityScapes and CitySearches as they knock on the door.

In Bailes' view, the online guide companies are focused primarily on the entertainment and event slices of a community, and that's the weakness that newspapers can exploit. A newspaper, because of its deep community roots, can assemble a broader and deeper online community service, while competing effectively as well in the entertainment and events areas.

KOZ won't cite pricing for its CPS system, but Bailes describes it as establishing a partnership relationship with a publisher, rather than simply licensing the product. Cox is KOZ's first client, but Bailes says deals with other publishers should be announced soon.

Contact: Harry Bailes,

AdOne Classifieds gets venture capital infusion

AdOne Classifieds Network reports that it has received a "multi-million dollar" equity investment from venture capital investment firm Lawrence, Smith & Horey. The New York company operates a World Wide Web service that aggregates classified ads from newspapers. The company has relationships with more than 80 publishers, representing more than 200 publications (mostly small and medium sized newspapers) with a combined readership of 11.5 million. For many of its client publications, AdOne has created their only presence on the Web.

AdOne earlier this year had received a seed investment by New World Equities, a venture capital fund that specializes in technology and telecommunications. The company was founded in March 1995.

Contact: Steve Brotman, chairman and CEO,

Movin' On

At Phoenix Newspapers (Arizona Republic and Phoenix Gazette), Howard Finberg has been named director of information technology. He formerly was senior editor of information technology.

Free ride is over

Just a reminder that the Wall Street Journal Interactive Edition will require a paid subscription to access as of Saturday (September 21). The price is $29 a year if you subscribe to the print edition, or $49 a year for online-only readers. If you use the Microsoft Explorer Web browser, you'll still get free access through December 21, 1996.

This will be an interesting move to watch, and I'll report on the Web site's online subscriber results when the Journal's executives are willing to release numbers of paying customers.


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