MICROSOFT’S SIDEWALK burst onto the online city guide scene like the gleaming white Hummer used to promote its Web site: two lanes wide and brimming with attitude. Characteristically, there was nothing subtle about Microsoft’s entry into the market. For the newspapers, magazines, local TV stations, and other online services the company was competing with in providing local where-to-go-and-what-to-do content, Sidewalk offered the usual Redmond ultimatum: “Get on board or get run over.”
While many editors and publishers were skeptical that Microsoft knew how to create editorial content for a local audience, no one doubted that the company was now a new, well-financed, ultra-aggressive media competitor with a technological advantage. Some, like Seattle Weekly and The Village Voice, contracted with Microsoft to provide calendar listings; and almost everyone, including the Weekly and the Voice, also launched or beefed up their own Web presence in response.
The visionaries behind Sidewalk saw it as a play with a huge upside: Think globally, sell locally. They wanted to leverage a new brand out of Microsoft’s existing one. Sidewalk’s own market research showed that local businesses and potential advertisers were willing to spend big money if Microsoft offered them a way to do business online. So in addition to providing arts and entertainment listings and restaurant reviews, Sidewalk was another way to sell Microsoft software and technological solutions to mom-and-pop businesses at the street level, shop by shop. Microsoft would set up the next generation’s yellow pages and ensure that its products were an integral part of the solution to how commerce, especially online commerce, would be done.
In many respects, Sidewalk’s most visible aspect—being a user-friendly guide to your city—was its least intimidating. Yet it was expensive to pull off. To derive real revenues, Sidewalk would have to attract droves of eyeballs, and to do that, its progenitors believed, it would have to have killer content. But the ultimate problem with that strategy, as outlined by a Microsoft exec familiar with Sidewalk’s start-up, was that while newspapers and magazines could leverage their content to get on the Web easily, Microsoft would have to start from scratch. Unlike its competitors, which had print, classified, and TV ad revenues (online banner ad revenues haven’t panned out as yet), Sidewalk had no content to leverage and no revenue streams. So whatever technological advantages Sidewalk could offer would come into play only after the investment of hundreds of millions of dollars to get loyal users. Would Microsoft have the patience to hang in?
No. Even at launch, Microsoft seemed to have second thoughts. While New York Sidewalk hired big-name editors and promised original reporting and independent reviews, other sites were thin, using canned copy and data. Others, like Seattle’s, were strong on the nuts and bolts, like calendar listings, but eventually seemed less intent on informing users about their city than sucking them into services selling cars or airline tickets. It was the difference between a real newspaper, say, and the ad guide you find in a local hotel room: narrowly useful, but soulless. For the most part, Sidewalk’s incarnations lacked the spirit or ambition of a Slate or Salon. Microsoft’s decision not to gut out the big play, says one former Sidewalker, is what doomed it.
Now some of Sidewalk’s vital organs have been transplanted into Ticketmaster’s CitySearch, which seems ready for the game that Microsoft wouldn’t play out. Still, Microsoft snagged a nine-percent stake—with the option to extend it to 13 percent and become the second largest investor in CitySearch, behind USA Networks—in the new venture, can beef up its own MSN portal, and retains the right to market its Internet products to CitySearch’s commercial clients. The arrangement involves lower risk and lower cost, and preserves for Redmond the ability to tap that potentially huge chunk of the iceberg—local retail sales—that Sidewalk was just the tip of.
Read more news on the Sidewalk deal:
Deal under construction by Richard Martin >>
