MySpace Targets Local Ads With Citysearch Partnership

In a bid to attract more small-business advertising, News Corp.’s MySpace is launching MySpace Local, which lets members of the social network rate and comment on small businesses in their communities and share the ratings with their friends. The basic business directory will be provided by IAC-owned Citysearch.

The service will provide some new streams of revenue for MySpace. MySpace Local will have several initial national sponsors, including Coors and Outback Steakhouse. Citysearch and MySpace will also split the revenue generated from local businesses when users click on Citysearch-provided content, like maps and menus. But more importantly the deal should provide a boost to MySpace’s self-service ad platform, called MyAds, which already lets businesses target their ads on the site. “MySpace Local will help us grow and diversify the businesses using that platform. Especially in this economic climate, we view that performance-based local advertising solution as an enormous opportunity for their businesses – and, of course, for ours,” MySpace president of sales and marketing Jeff Berman said during a conference call.

Small businesses, starting in the coming weeks with restaurants, bars, and nightlife venues, will each have pages on MySpace Local, propagated with the basic content from the Citysearch database. A MySpace member visiting the page of a business will first see the ratings and reviews of their friends and then those of other MySpace members. There will also be “CityHub” pages for all major cities in the United States, where MySpace members will be able to search for local businesses and also see instant reviews.

Citysearch CEO Jay Herratti said he wasn’t concerned that MySpace Local might siphon traffic away from his site, saying that it would expose his service to a “much larger audience.” Citysearch’s lead over rival Yelp has been narrowing recently and Citysearch recently relaunched its site.

MySpace CEO Chris DeWolfe said MySpace Local was a “natural evolution” for the social networking site, which he said had evolved into a social portal. Last fall, MySpace launched MySpace Music, which allows MySpace members to share music with friends. DeWolfe noted that service had been a success, with more than 100 million playlists created by MySpace members since its launch.