In October 2000,
The Kelsey Group released a White Paper entitled "Independent Yellow
Pages Publishers: Options for E-Commerce," in which TKG forecast considerable
growth for the independent publishing community, to some extent at the
expense of incumbent utility-affiliated publishers.
forecast called for independents' revenues to grow from $1.48 billion
in 2000 to $4.5 billion in 2005, which at that time would have amounted
to a 28 percent market share. By 2006, TKG predicts that share will
be 35 percent.
In 2001, The Kelsey
Group estimates the independent sector of the Yellow Pages industry
will grow by 17.5 percent to $1.74 billion. We believe the full impact
of the economy has not yet been incorporated into the individual publisher
forecasts. A number of major independents are entering their second,
third or even fourth canvass in some major markets, which should accelerate
growth in all but the weakest markets. Our 2002 forecast shows independent
publishers growing by 20 percent to roughly $2 billion.
Based on recent
interviews with some of the industry's leading independent publishers,
The Kelsey Group is confident of its long-range forecast, despite a
weak economy that may last well into 2002.
The future for U.S.
independent publishers is not without potential pitfalls. Independents
have failed to improve their performance in selling to the national
channel, a situation made more difficult by the current commission structures.
Independent publishers may also find themselves at a severe disadvantage
in the relative near future if online Yellow Pages products pick up
steam in terms of attracting usage, and with it a larger share of the
local ad budget.
Pages as a media category stands to gain from the advancements made
by independents. Rational advertisers will elect to move budget from
other media if independent and incumbent publishers continue to improve
the value proposition. While the intense competition between independent
and incumbent publishers may "feel" uncomfortable at times, all publishers
should be comforted if gains come at the expense of other local advertising