Yahoo! Consortium Working on Used Cars Portal

The newspaper consortium (“the amigos”) that teamed up with Yahoo! for Hot Jobs is planning to invade used autos next, according to a post by newspaper insider Ken Doctor. If it pans out, such an alliance would probably signal that Yahoo!’s 2005 deal with AutoTrader for listings will soon be over.

A Yahoo!-newspaper alliance for used autos would also be a blow to Classified Ventures’ Cars.com, which is owned by Gannett, McClatchy and Tribune, plus The Washington Post Co. and Belo. Cars.com has already suffered defections from The New York Times Co. and Philly.com, which have gone to Gabriels Technology Solutions. Likewise, The San Diego Union-Tribune and St. Louis Post-Dispatch have switched over to Adicio. The next chip to fall, logically, would be the San Jose Mercury News, which is owned by MediaNews Group, a leader among the amigos.

Newspapers are generally satisfied with the quality of the Cars.com site, but a taxing revenue share and licensing fees have taken a toll. Its one-size-fits-all nature has also come under criticism. Officials at Philly.com, which is jointly operated by The Philadelphia Inquirer and Philadelphia Daily News, for instance, told Classified Intelligence that their new solution has a number of features that Cars.com never offered, such as SMS text messaging, home-page dealer banner ads, new lead generators, dynamic search results and the ability to post stories from multiple sources.

By working with Yahoo!, newspapers may also move up the value chain for used autos. Yahoo! has a lot of auto manufacturer deals in place for national advertising, and these could theoretically trickle down to the newspaper sites. Newspapers may also get into other non-listing revenues, such as dealer CRM contracts and even data mining.

Yahoo!, for its part, may have needed to get out of its AutoTrader alliance. To be sure, it is unclear that the newspapers will be able to make up for the sheer volume of AutoTrader’s listings, locally. But as AutoTrader presses its dominance of the online used auto market, and moves beyond listings into other areas, such as services  something eBay is apparently also readying  Yahoo! may have felt that it made more sense strategically to extend the newspaper relationship.

What’s next beyond autos for the newspaper consortium? According to Doctor, all kinds of ideas have been tossed out. He notes that these include:

• Creating more of a local news alliance, whereby papers would feed more full-text local news onto Yahoo! with shared ad revenue;
• Sharing of Yahoo! tools, including social networking and tagging, with news companies so they could move their sites from 1.0 to something more resembling 2.0;
• Partnering around other major classifieds, first targeting cars and then real estate;
• Having Yahoo! act as an ad sales agent for the newspaper companies, with Yahoo! taking a revenue share of about 50 percent.