ServiceMagic 2009 Annual Report Download - page 10

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Table of Contents
listing (or select information from such listing) is viewed by a user on Citysearch.com or a CityGrid third party publisher website or mobile
application, a user clicks on a link to additional merchant information displayed as part of their merchant listing on Citysearch.com
or a CityGrid
third party publisher website or mobile application or a user calls a metered number to reach a business.
Marketing. We market our services to users primarily through search engines. We market our products and services to local merchants
and other advertisers primarily through in-house and outside local sales forces in major metropolitan areas within the United States, as well as
through our online self-enrollment model.
Revenues. Revenues are generated primarily through the sale of advertising, predominantly local, Pay-For-Performance advertising,
directly to merchants. When merchant listings are displayed on third party websites or mobile applications affiliated with CityGrid, we share the
related revenues that we receive from our merchants with the relevant third party. Revenues are also generated through the display of advertising
that we receive from third parties affiliated with CityGrid. If we display this advertising on Citysearch.com , the third party shares the related
revenues that it receives from its clients with us. If we then distribute this advertising to a CityGrid third party publisher, we share revenues
received from the third party that provided us with the advertising with the third party to which we distributed such advertising. Revenues are
also generated through our sale of local merchant and national display advertising on a per impression and fixed fee basis.
Competition. The markets for local content, local services and local advertising are highly competitive and diverse. While we primarily
compete with online and offline local and national directories, we currently face increasing competition from search engines and other site
aggregation companies that pull content from Citysearch.com for display on their websites (as well as other destination websites generally),
which adversely impacts our ability to monetize this content and interferes with search engine marketing efforts designed to drive traffic to
Citysearch.com
. We also compete with online advertising networks, online and offline providers of local content, telecommunications and cable
companies, internet service providers and niche competitors that focus on a specific category or geography and compete with specific content
offerings that we provide.
Match
Overview
Through the brands and businesses within our Match segment, we are a leading provider of subscription-based online personals services in
the United States and various jurisdictions abroad. We provide these services through websites that we own and operate in twenty-
five countries,
eight languages and five continents, as well as through our mobile application in the United States. As of December 31, 2009, we collectively
provided online personals services to approximately 1.3 million subscribers.
In June 2009, we sold the European operations of Match.com to Meetic, a leading European online dating company based in France, in
exchange for a 27% interest in Meetic and a €5 million note. In July 2009, we acquired PeopleMedia, a leading operator of targeted dating sites.
In February 2010, we announced the formation of joint venture between Match.com and Meetic, through which we intend to provide personals
services in certain countries in Latin America.
Products and Services
We primarily provide services through branded websites that we own and operate, including, among others, Match.com , Chemistry.com ,
BlackPeopleMeet.com
and SeniorPeopleMeet.com . These websites, all of which provide single adults with a private and convenient
environment for meeting other singles, generally provide online personal services to registered members and subscribers.
6