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Buyout of Sidewalk raises new questions about content
Perhaps it surprised few members of the digerati when software giant Microsoft announced last week that it was selling off the arts and entertainment guides portion of its beleaguered Sidewalk.com franchise of local Web sites in major markets. The company to which it sold the assets, archrival Ticketmaster Online-CitySearch, had been kicking virtual butt up and down the Sidewalk with its ticketing and e-commerce capabilities and, by most accounts, the nearly 3-year-old Sidewalk was hemorrhaging cash, big time.
What TMCS didn't have was Sidewalk's killer distribution through Microsoft Network, which it will now get in exchange for losing a meager 9 percent stake of the company to Microsoft. TMCS also lacked satellite offices in key cities, and in a space where Sidewalk failed to successfully spin money out of its content offerings-its business model had originally centered on plain vanilla advertising-TMCS had succeeded. So the marriage of convenience between former foes seemed sensible for both parties involved and they lived happily every after.
At least that's what the spin doctors want everyone to believe.
In truth, while the deal is a good one for Pasadena, Calif.-based TMCS, which beefs up its reach from 33 cities to 77 cities worldwide, Microsoft's divestment of the local entertainment listings portion of Sidewalk signals another retreat for Microsoft from the aggressive online content strategy it formulated only a few years ago.
The company's retention of the buyers' guides and yellow pages sections-the potentially lucrative (or theoretically revenuegenerating) parts of Sidewalk-gave off that now familiar swoosh of Microsoft swinging through the exit door of the content biz, in favor of the current "It" Web business model, e-commerce. "We looked at this limitless opportunity and decided that we really wanted to focus more and more on commerce," said Matt Kursh, business unit manager at MSN, during last Monday's teleconference announcing the sale of Sidewalk to TMCS. "That meant making some difficult decisions."
If Microsoft's track record on Web content is any indicator, however, the decision to give up on the Sidewalk...