June 8, 2005
`
`Consulting Services to the Classified Advertising Industry Vol. 6 No. 11 *
`IN THIS ISSUE
`AUCTIONS
`Yahoo drops all auction fees in the U.S.
`Page 14.
`SCORECARD
`Craigslist: 164 cities (unchanged)
`Cityopoly: 66 cities (unchanged)
`LowBid: 290 (unchanged; traction in
`Houston, NY, LA)
`Kijiji: 91cities (unchanged)
`Intoko: 4 cities (unchanged)
`Gumtree: 24 cities (unchanged)
`Oodle: 7 cities (New cities: Boston, LA)
`MetroMojo: 7 cities (unchanged)
`Pending launches in 50 cities
`LiveDeal: 70,000 metro, suburban, town
`and rural U.S. Zip codes (unchanged)
`Recycler: 13 (new addition to list)
`RECRUITMENT
`
`PowerOne drops C2,
`marketplace to focus
`on jobs, cars, Zwire
`Recommends HarvestINFO as replacement
`BY JIM TOWNSEND
`
`PowerOne Media is dropping its C2 classifieds and integrated
`marketplace technology from its product line to focus on its
`recruitment, automotive and publishing / national advertising plat-
`forms. The company recommended that customers switch to
`HarvestINFO’s Marketplace Local technology. (See CI Alert, June
`6.) While that might sound like a shocker, it’s a logical strategy for
`PowerOne.
`When it was launched in 2001, C2 was the most powerful plat-
`form ever built for big papers. It was also the most flexible – even
`though many class managers didn’t know how to fully exploit its
`flexibility.
`But the world of classifieds has revolved, and big papers in par-
`ticular now need something else. Big papers don’t need single-pur-
`
`WorldNow’s deal with Monster is geared
`to grow classifieds on TV Web sites.
`Page 17.
`AUTOMOTIVE
`
`Autobytel hires a new CFO and brings
`all its filings to date with the U.S. govern-
`ment. Page 25.
`REAL ESTATE
`MonsterMoving gets MLS listings, and a
`new owner. Page 22.
`INSIDERS
`Craig Dubow,Taek Kwon, Ken DePaola,
`Brian Evans and Sheila Marelo. Page
`26.
`
`© 2005 Classified Intelligence, LLC
`
`Continued on Page 3.
`
`AdMission’s patent: What’s it mean?
`
`BY JIM TOWNSEND
`
`It took six years, but AdMission Corp. now holds two U.S.
`patents on the processes it uses to upload and display rich media.
`The company’s core patent was issued in May 2004. Its newest
`patent was issued in May 2005. Both were filed in 1999, back
`when AdMission was Ipix Corp.
`San Ramon, Calif.-based AdMission, a provider of image-pro-
`cessing technology and a pretty slick ad-entry platform, was spun
`out of Ipix Corp. in February. With it went the intellectual property
`rights developed by Ipix.
`The U.S. Patent and Trademark Office granted Patent No.
`6,895,557, entitled “Web-Based Media Submission Tool,”
`describes in general terms the method by which any data element
`– be it a photo, video, music file or even text – undergoes prepro-
`cessing on the client side according to a server side set of instruc-
`
`Continued on Page 2.
`
`info@classifiedintelligence.com (cid:122) (407) 788-2780
`
`Exhibit 2053, Page 1
`Google Inc. v. Summit 6 LLC
`IPR2015-00806, Summit 6 LLC
`
`

`
`CLASSIFIED INTELLIGENCE REPORT
`AdMission
`Continued from Page 1.
`tions before it is uploaded to a server.
`It’s a so-called method patent, agnostic of the client
`and server technologies used to employ it, and of the
`operating systems that are used.
`As we reported in our June 1 alert, the newest patent
`has some far-reaching implications for Internet indus-
`tries. Our alert touched a small storm of criticism
`from a few other companies with ad-entry platforms,
`none of which we’ll name, each of which rushed to
`assure that nothing they were doing resembled
`AdMission’s methods of rich-media entry.
`That we can tell, no ad-entry provider that we know
`of (we know quite a few) collects data in AdMission’s
`unique fashion. We’re neither technologists nor intel-
`lectual property lawyers (and those we contacted
`CLASSIFIED INTELLIGENCE REPORT
`PETER M. ZOLLMAN, executive editor/publisher
`PZOLLMAN@AIMGROUP.COM (407) 788-2780
`NEIL SKENE, associate publisher
`JIM TOWNSEND, editorial director
`BRIAN BLUM, contributing writer
`LEE HALL, contributing editor
`ROSS HODDINOTT, contributing editor, Pacific
`KATJA RIEFLER, contributing editor, Europe
`DEANNA SHEFFIELD, editor
`JOHN ZAPPE, associate, contributing editor
`PHYLLIS TURNER, business manager
`AMY RABINOVITZ, marketing director
`NICK ROGOSIENSKI, business development
`~
`Classified Intelligence is affiliated with
`the Advanced Interactive Media Group,L.L.C.
`~
`From time to time,Classified Intelligence Report
`and our writers cover companies that are clients
`of Classified Intelligence, LLC,
`or the AIM Group.
`We make every effort to ensure that
`our editorial content is objective and
`is not compromised by any client
`relationships we have.
`~
`Published twice monthly, except once in December,
`by Classified Intelligence, L.L.C. © 2005.
`This publication may not be reproduced in any form,
`in whole or in part,except by licensed clients.
`
`Member of
`the Newspaper
`Association of
`America.
`
`© 2005 Classified Intelligence, LLC
`
`June 8, 2005
`
`VERSION 6.11 (cid:122) Page 2.
`
`declined to be quoted). Patent compliance can be a
`sticky issue. If you have any doubts about your sys-
`tems, you should consult your attorneys.
`Nonetheless, criticism of our alert was warranted, as
`it underexplained some points and overreached oth-
`ers. For instance, the patent wouldn’t appear to apply
`to systems that upload “raw” photos (or other data
`files) and performs no manipulation of files before
`they are uploaded. If client-side manipulation occurs,
`it would have to be based upon server-side instruc-
`tions to the client in order to fall into AdMission’s
`patent space.
`Taking the example further, if a system were to
`allow the user to add a caption to a photo, or resize it,
`or add a watermark – before it’s uploaded – that
`might violate AdMission’s patent if the server is
`telling the client what to do.
`While AdMission’s ad-entry competitors don’t
`appear to operate this way, we note a few companies
`in other Internet industries that seem to. MSN features
`a degree photo preprocessing. Just last week, Yahoo
`launched a photo e-mail service that allows users to
`drag-and-drop up images to create up to 300 thumb-
`nails in a single e-mail message, with captions.
`Whether the methods Yahoo and MSN are using are
`similar enough to AdMission’s patent, we don’t ven-
`ture to say. If there are legal issues, that’s for attor-
`neys to sort out.
`Still, the patent’s implications are far-reaching. For
`one, it means that if you wanted to emulate the
`process in your own business, you’d have to license it
`from AdMission. And if you’re a direct competitor,
`AdMission isn’t likely to license to you. Whether
`you’d want to or not, the significance is that you can’t
`go down that path.
`For another, the patent is not limited to PCs.
`Emerging mobile platforms – phones, PDAs and net-
`workable, handheld entertainment devices – often
`operate in client-server environments because of lim-
`ited processing power. As these handhelds proliferate
`– as you build mobile services – to be certain,
`AdMission will be watching how these technologies
`interface with the Web.
`“The opportunity that we foresaw was that if you’re
`going to work with media, and you wanted to create
`some sort of standard for collection, just like you
`would collect textual or numeric data, there needs to
`be some additional work there,” said AdMission VP
`Scott Lewis, co-author of the patents. “Anywhere you
`would want to use it, whether a blog, an instant mes-
`sage, an auction or a classifieds experience, a person-
`als site – an insurance claim – anywhere where you
`have people remote who are collecting media ele-
`ments, and they’re needing to get that in some way
`
`Continued on Page 3.
`
`info@classifiedintelligence.com (cid:122) (407) 788-2780
`
`Exhibit 2053, Page 2
`Google Inc. v. Summit 6 LLC
`IPR2015-00806, Summit 6 LLC
`
`

`
`CLASSIFIED INTELLIGENCE REPORT
`PowerOne
`Continued from Page 1.
`pose, catch-all classified platforms.
`They need technology that meets the very specific
`needs of their automotive, recruitment and real estate
`customers; they need interactive / transactive market-
`places where their communities can buy and sell in
`real-time.
`C2 is the B-52 of classified systems. Times changed,
`and (happily) we don’t buy B-52s anymore. That
`PowerOne should phase out C2 simply makes sense.
`Instead, PowerOne is focusing on where it sees “the
`best opportunities for growth, and specifically, where
`newspapers need us the most,” PowerOne chairman J.
`Markham Green told us, adding that the decision “has
`no material affect on our solid financial picture.”
`He said the company was in good fiscal health, and
`that the decision was a matter of focusing resources.
`“Were a small company. I think we have 125 employ-
`ees. We just cannot take on the world.”
`PowerOne will continue to support C2 customers
`until their contracts expire. “We wouldn’t leave any-
`one out in left field,” Green said.
`PowerOne’s core products include CarCast, Center
`for American Jobs, a rebuilt CareerSite and Zwire,
`which is host to more than 1,000 U.S. small daily and
`weekly newspapers. Zwire-hosted papers include an
`integrated AdQuest classifieds platform.
`“We really see opportunity in automotive, the Zwire
`national advertising business and especially employ-
`ment,” Green said.
`He noted that CareerSite was recently rebuilt from
`the ground up – see CIR 6.06, March 23 – and that
`the company is in the process of switching about 170
`papers to the new platform. “We’re now hiring sales
`
`VERSION 6.11 (cid:122) Page 3.
`June 8, 2005
`people. We’re now in the position we can start to
`ramp up sales.”
`The CareerSite upgrade was financed in part by the
`sale of lead-generator Franchise Solutions to
`Landmark Communications for an undisclosed sum.
`(See CIR 6.03, Feb. 8.)
`“We’ve no illusions that we don’t have a lot to do in
`every one of these disciplines. Just because we’ve got
`good technology in CareerSite, there’s still a heck of
`a lot to do. We can’t fight a war on every front,”
`Green said.
`The 80+ users of PowerOne’s Unix-based C2 were
`informed of the company’s decision before the public
`announcement. PowerOne and HarvestINFO have
`worked out a migration schedule for papers interested
`in switching. Green said that the company will work
`with papers on a switch to any platform provider.
`Green acknowledged that he felt HarvestINFO’s
`Marketplace Local was a superior product. Harvest
`demoed the technology at Nexpo in Dallas – see CIR
`6.06 – and received positive responses. Whether
`HarvestINFO’s “preferred replacement solution”
`agreement amounts to any more than an endorsement,
`or if any money is changing hands, Green wouldn’t
`say.
`Mason, Ohio-based HarvestINFO serves more than
`400 newspapers worldwide.
`“The investment in HarvestINFO continues more
`aggressively than ever before to meet current and
`future customer growth and capacity requirements,”
`said CEO Scott Bailey. “We have a real passion for
`technology at HarvestINFO and we will continue to
`push the envelope with our new products and drive
`the online successes of our customers. These addi-
`tional investments and enhanced product features
`enables us to be the preferred provider to the
`industry.”
`
`AdMission
`Continued from Page 2.
`homogenized, processed, standardized and distributed
`up to a remote destination. …
`“It’s doing that intelligent division of work between
`the client and the server, where you’re determining
`what is the highest-quality piece of data you need to
`preserve on the server side. … It’s really just to say ‘I
`only need this much data [on the server] and I’m
`going to append that with additional detail to give
`context and meaning to the data – and then I’m going
`to pass that to the server.’”
`Once the data’s on the server, it might require redis-
`tribution to multiple servers, where each has its own
`requirements for the data. That’s where the May 2004
`patent comes in, Lewis said. U.S. Patent No.
`
`6,732,162 describes processes in which digital media
`might be reformatted on the fly for any number of
`data destinations.
`How much of a business AdMission might build in
`patent licensing remains to be seen, but it could be
`significant, if not huge. It already licenses to EBay.
`But for now, the company will continue to concen-
`trate on its core products, said AdMission CEO and
`president Sarah Pate.
`“We’ll continue to use our patents to support our
`interfaces to give our customers an absolute competi-
`tive advantage,” Pate said, adding that the company is
`“aggressively looking” at ways to leverage its patents
`outside its core markets. “We think there are several
`potentially lucrative licensing opportunities.”
`
`© 2005 Classified Intelligence, LLC
`
`info@classifiedintelligence.com (cid:122) (407) 788-2780
`
`Exhibit 2053, Page 3
`Google Inc. v. Summit 6 LLC
`IPR2015-00806, Summit 6 LLC
`
`

`
`CLASSIFIED INTELLIGENCE REPORT
`
`JUNE 8, 2005
`
`VERSION 6.11 (cid:122) Page 4.
`
`ICMA publishers
`show online savvy
`
`BARCELONA – Quite a turnout at the semi-annual
`gathering of the International Classified Media
`Association last week. More than 150 delegates from
`29 countries, from as far away as Perth, Australia and
`Johannesburg, South Africa – where Junk Mail still
`ranks in my book as the coolest name ever for a free-ad
`publication.
`ICMA members are still mostly print publishers;
`some have moved online far faster and far more effec-
`tively than traditional newspaper publishers, while oth-
`ers are admittedly behind the curve. Location matters,
`too; in areas like Scandinavia, print classifieds are now
`secondary to online, while in others, including some in
`eastern Europe, Internet penetration is so low that
`online is still relatively insignificant – at least today.
`ICMA members’ products run the gamut, from paid-
`circulation with free ads (the “Loot” model) to free cir-
`culation and paid ads; direct mail to home-delivered to
`newsstand. Paid print circulation is down almost every-
`where. Most products have at least a nominal Web pres-
`ence; some are so advanced that they’re models of
`excellence among online classified players. And accord-
`ing to my highly informal poll – Don’t you love that? It
`usually means “I talked to a half-dozen people,” or in
`this case “I talked to a half-dozen people and also
`asked for a show of hands among the 30 people in my
`workshop” – most are still growing in print. But they
`know the long-term future for print is downhill. I saw a
`lot of head-nodding when I used one of my favorite
`new-media quotes – from MediaNews Group chairman
`Dean Singleton, who said a while back: “If we
`acknowledge that the core business is in decline, and
`put our efforts in the non-core business, we’re going to
`be fine. … [But] if we sit around and wait for the econ-
`omy to recover, those people are going to die.”
`* * * *
`Interesting tidbits from Oscar Diele of Marktplaats.nl,
`the No. 3 site in the Netherlands. It nearly put De
`Telegraaf out of the classifieds business; started by one
`guy in 1999, it was sold to a small retailer, Het Goed
`Beheer, which in turn sold it to EBay last November for
`€225 ($290 million US). (See CIR 5.22, Nov. 22, 2004.)
`“EBay sees classified as a logical extension of the
`auction format. It’s just another format of buying and
`selling online,” Diele said. “We believe there are certain
`categories which are more effective for classifieds and
`
`© 2005 Classified Intelligence, LLC
`
`some categories that are more effective for auction list-
`ings. …
`“The classified model works where people want to
`meet in person. Classifieds are focused on cities. There,
`where people really want to see the item or where the
`value of the item is so high you want to do an in-person
`transaction, that’s where we believe the classified model
`works best.”
`MarktPlaats spent nothing on marketing before the
`acquisition; “Now we do,” Diele said. It generates more
`than 2 million new ads each month; they stay online for
`at least 28 days. On an average day, 70,000 new ads are
`posted, with one posted per second “on a good day.”
`Most of the marketing spending is on search engines,
`portals and affiliations. MarktPlaats has upgraded its
`photo services; improved search, and is also incorporat-
`ing EBay listings in some categories. The site carries
`1.6 million ads at any given time; “We tell our users, if
`you can’t find it on MarktPlaats, it’s probably not
`online. And in my opinion, that’s what classifieds are
`meant to be.”
`Why is it so popular?
`“Haggling, getting the price down, is really a national
`sport in the Netherlands. We are just cheap – we like to
`bargain and we get a kick out of it,” Diele said. “It’s
`just simple, easy and fast to use. … You can list your
`item within 60 seconds. Our consumers want it to be
`simple and fast. We take away a lot of frills and func-
`tionalities that we don’t think add value to the transac-
`tion (to make it so efficient).”
`While some ads are free on MarktPlaats, many are
`paid – at a rate of €6 ($7.50 US). Diele said fewer than
`half of the ads are paid, but would not be more specific.
`* * * *
`Self-service ad placement is growing very rapidly in
`many international markets. At Apru.hu, a free-ads pub-
`lication in Hungary, more than 30 percent of ads come
`in by SMS; another 30 percent via the Internet. To place
`ads by phone, there’s a charge; only 2 percent of ads are
`phoned in.
`Peter Rees of Trader Classified Media said his com-
`pany, too, has had great success in some markets with
`self-service ads. In one market, more than half of all ads
`are submitted online.
`
`Continued on Page 5.
`
`info@classifiedintelligence.com (cid:122) (407) 788-2780
`
`Exhibit 2053, Page 4
`Google Inc. v. Summit 6 LLC
`IPR2015-00806, Summit 6 LLC
`
`

`
`CLASSIFIED INTELLIGENCE REPORT
`IMCA
`Continued from Page 4.
`
`* * * *
`In a wide-ranging presentation, Rees was remarkably
`candid about what’s going on at TCM, which generally
`tries to fly under the radar. He gave great examples of
`what Trader is doing right, and also ‘fessed up to a few
`mistakes Trader has made that it’s fixing.
`Following two EBay guys who talked about gross
`merchandise value, Rees noted that Trader’s never cal-
`culated the “GMV” of the items on its sites and in its
`publications. (It would have no reason to, of course.)
`But he said a very rough calculation showed that Trader
`and all of its various sites (56 Web sites in 20 countries)
`carry an estimated $120 billion worth of cars each year.
`Take that, EBay!
`Even though the company’s print revenues grew 7
`percent organically and 11.7 percent overall last year,
`the Internet now generates 11 percent of revenue and is
`the fastest-growing sector. He urged attendees to pay
`attention: “Do you in your business know what percent-
`age of your revenue will come from the Internet in five
`years time?” he asked.
`Rees said the company is investing heavily in out-
`bound call centers, and showed 58 percent growth in
`revenue from outbound calls in 2004. As the number of
`ads placed online or through other self-service methods
`reduces inbound calls, he said, those sales reps are rede-
`ployed to outbound sales.
`One “disaster” the company is fixing: A self-service
`ad site where the customer had to register before plac-
`ing an ad, enter 12 pieces of personal information, wait
`for an e-mail with a password and ID, and then place
`the ad. Only about 2 percent of the people who started
`the process finished it. It’s being fixed. “Site functional-
`ity is … probably the most significant influence on traf-
`fic and content growth [we have]. Without this we will
`not succeed.” He also said the company is now careful-
`ly monitoring internal metrics like ad-completion rates
`and user navigation, as well as external ones like page-
`views, unique users and site rankings.
`What does Rees see as “hot” right now?
`(cid:132) Classified aggregators like Oodle; he noted Metro
`in Scandinavia is aggregating ads – “stealing,” he called
`it – from other papers. He wondered how courts will
`rule on the question of who owns rights to classified
`advertising content.
`(cid:132) Local pages, especially Google maps in the U.S.
`(cid:132) Pay-for-performance. “It used to be most of us just
`charged a flat fee [for an ad]. On the Internet, you get
`the way to develop pay-for-performance. Often we can
`charge advertisers more, if we can bring them value.”
`(cid:132) Community sites like Craigslist, Kijiji and Gumtree.
`He said EBay registered the Kijiji.com domain way
`
`June 8, 2005
`
`VERSION 6.11 (cid:122) Page 5.
`
`back in February of 2000. “I think this is the one to
`watch. I bet you they are going to follow the Craigslist
`business model with a MarktPlaats revenue model.”
`(cid:132) Social networking, sites like LinkedIn.
`(cid:132) Rich-media content.
`(cid:132) Asia as an emerging market, and
`(cid:132) Mobile technology as a delivery medium for classi-
`fieds.
`Surprisingly, he said TCM would be adding a lot of
`Craigslist-style community content tools to its sites dur-
`ing the next few months. To us, that’s certainly one to
`watch, too.
`
`* * * *
`One more interesting factoid from Rees: Infojobs in
`Spain, the company’s recruitment site, has CVs regis-
`tered from about 4 percent of all Spaniards, he said.
`* * * *
`Ralph Werner of Mobile.de, EBay’s Europe automo-
`tive site (based in Germany), echoed a recent column of
`mine when he explained how Mobile was able to get so
`big so fast. “It was a pure-play – there was nothing to
`lose and a lot to win.”
`It also helped that the entrepreneur who started the
`site realized pretty quickly that he didn’t understand the
`auto business, so he brought in two auto-dealer broth-
`ers. “They had a deep understanding about the cus-
`tomer, about the [auto] dealer and the dealers’ needs. …
`And there was high speed of execution.”
`* * * *
`Bob Cauthorn of CityTools, formerly of SFGate and
`the San Francisco Chronicle, got rave reviews for his
`workshop for publishers. (Sadly, I couldn’t attend; he
`was on opposite my workshop on technology and busi-
`ness development.) Hard to believe how diligent the
`ICMA delegates are – his session, mine and one other at
`the same time were packed, even though they were
`four-hour sessions on a Saturday morning after every-
`one had been out late partying on Friday night.
`* * * *
`Without doubt the single best conference session I’ve
`attended in many years was not a session at all in the
`usual sense. At the start of the conference, they held a
`“mini-Olympics” on the beach in Barcelona, near the
`site of the 1992 Summer Olympics. It was a great way
`to take advantage of the setting and provide local color
`and flavor, and to encourage informal networking
`among both old friends and new attendees. How often,
`after all, have you gone to a great or exotic location and
`spent all of your time in the hotel or airport or con-
`ference center?
`
`© 2005 Classified Intelligence, LLC
`
`info@classifiedintelligence.com (cid:122) (407) 788-2780
`
`Exhibit 2053, Page 5
`Google Inc. v. Summit 6 LLC
`IPR2015-00806, Summit 6 LLC
`
`

`
`CLASSIFIED INTELLIGENCE REPORT
`
`June 8, 2005
`
`VERSION 6.11 (cid:122) Page 6.
`
`Celebrating the 400th birthday of newspapers ...
`
`BY KATJA RIEFLER
`
`SEOUL – More than 1300 participants from 82
`countries gathered last week at the World Association
`of Newspapers’s (WAN) annual conference and Editors
`Forum in South Korea’s capital in order to discuss “the
`keys to success” for newspapers and the most effective
`ways to react to a changing readership.
`“It has been an extraordinarily positive 12 months for
`the global newspaper industry,” said Timothy Balding,
`director general of WAN. “We have come to expect big
`circulation gains in developing countries, but it has
`been a very long time since we saw such a revival in
`so many mature markets. Newspapers are clearly
`undergoing a renaissance through new products, new
`formats, new titles, new editorial approaches, better
`distribution and better marketing.”
`2004 saw the best overall advertising performance in
`four years, with a revenue increase of 5.3 percent,
`although newspapers’ share of the world ad market
`declined from 30.5 percent in 2003 to 30.1 percent,
`according to new data from the yearly WAN survey.
`Bundling print classified advertising with online activi-
`ties has helped the newspapers to maintain their classi-
`fied market share. The audience for newspaper Web
`sites grew 32 percent last year and 350 percent over
`five years. Internet advertising revenues continue to
`grow rapidly, and were up 21 percent in 2004, the
`highest growth for five years.
`Carlos Oliva-Vélez, EVP of Metro International,
`spoke about his company’s rise to become one of the
`world’s largest publisher of free sheets that, on aver-
`age, launches one new edition every 45 days. He urged
`the participants in his presentation not always to ask
`“why,” but sometimes ask, “why not?”: “Why not
`make a valid business out of publishing free newspa-
`pers? Why not explore new options?”
`“Why not” is indeed an interesting question. You
`could, for example, look at the conference program and
`ask why none of the sessions during the four-day-event
`was devoted to classified advertising and/or online
`advertising. Many speakers talked about new print
`products or how to use mobile phone platforms in their
`product mixes. Most of them urged their peers to try to
`make their newspaper products and brands more com-
`pelling, even “irresistible” to readers. (This quote is
`from Kevin Roberts, CEO worldwide, Saatchi and
`Saatchi. However, when asked by the audience which
`newspaper in the world he would name as an example,
`Roberts came up with only one: The Daily Mail in the
`U.K., of which he said, “may perhaps have gained this
`position with part of its female readership.”)
`Even the future-oriented sessions, which focused on
`
`© 2005 Classified Intelligence, LLC
`
`the challenges posed by a “ubiquitous networking soci-
`ety,” dealt more with mobile news and new ideas for
`involving readers (for example, by recruiting them and
`their mobile camera phones as on-demand reporters as
`does Norway’s biggest newspaper, VG), than with gen-
`erating advertising revenue with digital media.
`To be fair, WAN strategy adviser Jim Chisholm, in
`charge of WAN’s “Shaping the Future of the
`Newspaper” project, mentioned two advertising-related
`concepts in his presentation, 10.5 Ways to Use Your
`Mobile Phone. He said that papers can increase adver-
`tising sales, espe-
`cially classifieds,
`through tools such
`as MMS, where
`consumers can see
`photos of products.
`He also said that
`advertiser response
`improves through
`mobile use as
`newspapers beam their advertisements to consumers’
`phones while they shop. And Arthur Ochs Sulzberger,
`publisher of The New York Times, constantly reminded
`the audience that “digital will be the new revenue driv-
`er,’ and that you have to “either follow (your cus-
`tomers) on the Internet or you kiss them goodbye.”
`So why not talk about online classifieds? First possi-
`ble answer: The event was somehow overshadowed by
`the 400th birthday of the printed newspaper. This event
`forced the various representatives of the newspapers
`and associations to almost ritually honor the value of
`ink-on-paper and to confirm their ongoing commitment
`to this media form. Therefore, any success stories
`about classifieds had to be about print’s success.
`Indeed, there seem to have been some successful
`launches of new products, mostly zoned editions that
`are distributed as newspaper inserts on a weekly basis.
`Second possible answer: Newspapers worldwide –
`perhaps with the exception of Africa and developing
`countries – accept that the Internet has become an inte-
`gral part of their business and therefore it doesn’t need
`to be mentioned or dealt with separately. WAN presi-
`dent Gavin O’Reilly, COO of Ireland-based
`Independent News & Media PLC, summed it up when
`he questioned the notion of newspapers’ demise:
`“We’ve invested millions and millions in new, state-of-
`the-art color production facilities; we’ve become lead-
`ers in merchandising; we’ve invested millions behind
`our brands; we’ve aggressively targeted consumers –
`both young and old; we present a medium that is rela-
`
`Continued on Page 7.
`
`info@classifiedintelligence.com (cid:122) (407) 788-2780
`
`Exhibit 2053, Page 6
`Google Inc. v. Summit 6 LLC
`IPR2015-00806, Summit 6 LLC
`
`

`
`CLASSIFIED INTELLIGENCE REPORT
`
`JUNE 8, 2005
`
`VERSION 6.11 (cid:122) Page 7.
`
`KR papers launch free online merchandise ads
`
`BY JIM TOWNSEND
`
`Here’s an idea worth watching. Knight Ridder
`announced it would no longer charge for self-placed,
`private-party, online-only merchandise ads in 22 of its
`27 newspaper markets. (See CI Alert May 27.) It’s a
`move calculated to drive more people to the newspa-
`pers’ Web sites – people who never used the papers to
`sell anything; people who never used the papers to
`buy.
`Later this summer in nine of its larger markets, KR
`intends to make it possible for private-party merchan-
`dise advertisers to use the same Web-based self-serv-
`ice to place their ads in print, as an upsell.
`That’s print as the upsell. Prices will be based on the
`rates charged by newspapers, depending on the paper
`and the market.
`Clearly, the forces that will inevitably shape
`those rint upsell models have yet to fully materialize.
`It remains to be seen whether print upsells will attract
`free-ad advertisers. But at the very least, it creates
`opportunity for the KR papers to market to new audi-
`ences.
`“It’s an exciting prospect for us to be able to convert
`some of these new advertisers who have not tradition-
`ally advertised in print,” said Susan Kennedy, KR’s
`director of online private-party ads.
`The move put Knight Ridder on a more equal foot-
`ing with Craigslist and other free-ad sites, especially
`in larger markets, and allows the papers to develop
`new audiences – and new revenue streams.
`
`WAN
`Continued from Page 6.
`tively fragmentation-proof; and the Internet – suppos-
`edly the nemesis of our industry – has in fact become a
`critical and vibrant part of our product and brand mix.”
`Third possible answer: There still are not enough
`success stories to tell. Unfortunately, this explanation
`might be the most compelling one. Park Chang-hee for
`example, GM of JoongAng Ilbo Strategic Planning in
`Korea, said that his newspaper has not yet succeeded in
`really profiting from the enormous growth of mobile
`Internet users in his country. Video, music and enter-
`tainment seem to be much more popular with the users
`than the text information his newspaper is able to pro-
`vide.
`Shin-Ichi Hakoshima, president and CEO of The
`Asahi Shimbun in Japan, the world’s second largest
`newspaper with a daily circulation of more than 12
`million said: “Our future depends on our ability to uti-
`lize the Internet. In my mind, the only response to
`© 2005 Classified Intelligence, LLC
`
`In November, Knight Ridder launched Web-based
`self-service ad tools in all of its papers. At the same
`time, it made online, private-party merchandise ads
`free for items of under $200 value, and $4.95 per
`month for items over $200 in value. It also launched
`free online-only pet ads. Across all markets, those
`listings categories have seen a 75 percent traffic
`growth since November, according to Kennedy.
`About 50 percent of that growth has been in merchan-
`dise; the remainder in pets, real estate, professional
`services and to a lesser extent, automotive.
`“We are bringing many new customers to Knight
`Ridder through this channel,” Kennedy told us.
`With the larger markets, there is so much interest
`and so much activity – all this is pointing to the
`vibrancy of these marketplaces. It’s important to us to
`continue to build that presence in our markets. …
`We’re now training a behavior here,” she said. “We
`know people really relate to this. They enjoy it. They
`find it effective for their buying and selling needs.”
`At the same time, the papers began reintroducing
`pricing in the pet category. Kennedy said that the
`papers had created such “phenomenal” interest and
`traffic among pet owners that she believed the new
`marketplaces would sustain a price introduction.
`“Pageview counts in that category are higher than any
`other. There’s been a level of engagement that has
`been wonderful to see,” she said.
`Knight Ridder’s papers include The Philadelphia
`Inquirer, Detroit Free Press, The Miami Herald
`and the San Jose Mercury News, among others.
`
`change is change: We must actively seek ways to
`change ourselves so that we can find a way to live
`together with the latest new media form.” The Asahi is
`in a “trial and error” stage with new media, as
`Hakoshima put it, but has a longer history with it than
`most.
`Usually, Asahi Shimbun is attributed to being one of
`the most successful digital media enterprises run by a
`newspaper company outside the U.S. Its Web site,
`Asahi.com, launched 10 years ago, has more than 200
`million page views per month and is Japan’s most pop-
`ular news site. The newspaper is most famous among
`its peers for its mobile services that reach more than 1
`million subscrib