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THE CUTTING EDGE

Times, CitySearch Team Up on Internet

Alliance: Partnership boosts CitySearch's effort to develop a global network of online city guides.

June 23, 1997|KAREN KAPLAN | TIMES STAFF WRITER

Moving to expand its presence in cyberspace, the Los Angeles Times today will announce a broad alliance with Pasadena-based CitySearch, a leading provider of community-oriented information on the Internet.

The two companies will collaborate on a local news and information service that will be operated by The Times and integrated with the newspaper's existing World Wide Web site (http://www.latimes.com).

Times Mirror Co., parent company of The Times, will invest an undisclosed sum in CitySearch, and the partnership may be extended to other Times Mirror newspapers, including Newsday, the Baltimore Sun and the Hartford Courant.

The deal gives CitySearch (http://www.citysearch.com) a major boost in its effort to develop a global network of online city guides. The company, launched two years ago by entrepreneur Bill Gross, reached a similar agreement with the Washington Post last month and now operates guides in Pasadena, New York, San Francisco, Nashville, Raleigh-Durham, N.C., and Austin, Texas.

"We hope that CitySearch will become the independent standard for the newspaper industry," said Robert N. Brisco, senior vice president of marketing and new business development at The Times. "It's a great solution for community information, arts and entertainment information and a lot of local content areas."

Times Mirror--which also owns Hollywood Online (http://www.hollywood.com) and is a partner in CareerPath (http://www.careerpath.com)--has long been considering an alliance with one of the emerging Web-based community guides. America Online, which now has more than 20 Digital City sites (http://www.digitalcity.com), and Microsoft Corp., which is slowly rolling out its Sidewalk service in cities across the country (http://www.sidewalk.com), had also been wooing the newspaper company.

The Times will own and operate the new service--which is expected to be online by the end of the year--through a licensing agreement with CitySearch, Brisco said. The arts, entertainment and recreation information on the as-yet unnamed site will be deeper than the content currently available on the newspaper's site, he said.

"The L.A. Times is trying to be the news source for the region, with the newspaper first and foremost," said Steven Barlow, an analyst with Credit Suisse First Boston in New York. "What they do best is process and gather information, and this is a different way to do that." The deal will help The Times sell online advertising and preserve its dominant position in the local advertising market, he said.

Analysts said The Times was wise to choose CitySearch as its partner and avoid becoming bedfellows with a company--such as Microsoft or AOL--that could be a long-term rival as a source of news, entertainment and classified advertising.

"If you are the Los Angeles Times and you partner up with CitySearch, you don't have to worry that CitySearch is going to pick your pocket," said Bill Bass, an analyst with Forrester Research in Cambridge, Mass. For CitySearch, a partnership with Times Mirror is "a huge coup," he added.

One of the Internet's greatest charms is the ease with which it connects people who are half a world away. But Charles Conn, chief executive of CitySearch, notes that "people spend 90% of their time and money within 15 miles of home."

The CitySearch sites provide extensive listings on entertainment, dining, shopping and lodging, as well as news, local features, information about community groups and discussion forums. They also provide links to movie listings, government representatives and even traffic reports.

Unlike other Web services that rely on so-called banner advertising to make money, CitySearch's business model is based on selling inexpensive Web pages to small businesses, which use them to augment their online listings.

CitySearch, which has raised more than $30 million in funding from investors including AT&T Ventures, Goldman, Sachs & Co. and Compaq Computer Corp., also has a broad alliance with Ticketmaster Corp. for online ticket sales.

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