Yellow Pages partners with Yahoo!7

Yellow Pages to partner with Yahoo!7 to build new online publishing platform for web and mobile

5th Nov 10, 2:08pm by Bernard Hickey

Yellow Pages Group has announced a partnership with Yahoo7 in Australia to build new online and mobile publishing platforms.

Yellow Pages is spending NZ$30 million improving its technology and online publishing systems.

The Yahoo7 partnership is the second after its announcement earlier this week of a deal to improve its print advertising publishing technology with UK-based Miles 33.

Yellow Pages CEO Bruce Cotterill told a news briefing in Auckland the partnership involved Yahoo supplying a 'white label' version of its technology for Yellow Pages to use as its mobile and online directories. Yellow Pages aimed to launch the new platforms some time in 2011.

"We'll be paying them for a software licence," he said, adding that Yellow Pages would retain control over the way the directories operated and developed online. The deal did not change Yellow's existing relationship with Google.

In October Yellow announced plans for a total of NZ$40 million of new investment to improve earnings after its owners and bankers decided not to sell the businesss. This includes the technology spending and the hiring of 100 new sales staff.

YPG was sold by Telecom to Hong Kong-based Unitas Capital and Canada’s Ontario Teachers’ Pension Plan in March 2007 for NZ$2.24 billion in a leveraged buyout that included about NZ$1.5 billion of debt. That had swelled to NZ$1.8 billion by June 30 last year, and with revenue falling YPG breached its banking covenants.

Its banking consortium, led by BNZ and including ANZ and Westpac, then hired Goldman Sachs to try and sell the business. But when offers failed to meet expectations, drastically reduced from the price Telecom got for the business, YPG was taken off the market in late September.

Cotterill said the business was now worth around NZ$800 million to NZ$1 billion and the owners wanted to invest in the business to protect and enhance that remaining value.

Yellow Pages said it wanted to tap into Yahoo7's global expertise in search technology and web publishing. Yellow's Digital Director, Peter Crowe, was the head of Yahoo7's search business in Australia for 3 years until 2006.

Crowe said a team of technologists would be dedicated within Yahoo7 in Sydney and Auckland to work with Yellow Pages to build its online and mobile publishing technologies.

Cotterill said Yellow had considered doing the work in-house or with other technology partners here in New Zealand and elsewhere, but bringing in Yahoo reduced the risks of the project being completed on time and on budget.

"You take execution risk away," he said of the decision.

See more background in this Double Shot interview by Gareth Vaughan with Yellow Pages CEO Bruce Cotterill here

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5 Comments

by Rob | 5th Nov 10, 2:24pm 1288920281

I thought they wanted to lose the telecom association. However yahoo and telecoms xtra already are yahoo nz nz. eg the yahoo nz website is telecoms xtra website start page. It is all very confusing for the end customer ,who just wants something simple eg. google.

by Robert | 5th Nov 10, 2:53pm 1288922016

There is no way the business is worth NZ$800 million to NZ$1 billion. It was said allegedly the best bid in the recently aborted sales process was NZ$450 million. This is a global environment where Yellow Pages revenue & use is dropping fast, the banking syndicate should have taken that alleged NZ $450 million.

Yellow has many competitors or potential competitors in the digital/online environment, that's a problem. Yet, the BIG problem is it's said somewhere between 80-85% of Yellows revenue is estimated to be from print & this is all going out the door, fast. What will they do?

According to Gates directories might be nearly gone in just another 3 years.Two years ago Bill Gates gave a talk about what he saw the future of advertising becoming and he said “Yellow Page usage among people, say, below 50, will drop to zero – near zero – over the next five years.” Bill isn’t a billionaire because he’s a dummy.

by tristanb | 5th Nov 10, 3:40pm 1288924839

Yahoo!?

What the hell is that? The next thing you know they'll be partnering with MySpace, GeoCities or Go.com!

Yahoo is dying. And as much as I loved Yellow Chocolate, I'm afraid Yellow Pages missed the boat by letting Google Earth partner with others.

by Expatriated | 6th Nov 10, 5:18am 1288973936

YP and every other traditional directory service will die a slow death.

You see, there's this small and relatively new company called Google which is already data mining numbers and geocoding addresses.

You can search from your phone or your PC and no need for business to pay to advertise since they're automatically included.

by Rob | 7th Nov 10, 1:24pm 1289089475

Cotterill said the business was now worth around NZ$800 million to NZ$1 billion and the owners wanted to invest in the business to protect and enhance that remaining value.

Correction, it is only worth what someone else is prepared to pay for it. If it was worth that, they woulld have probably sold it at that, as someone would have been prepared to buy it. Maybe they have been given some bad advise over it's value, and the original amount they paid for it.