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Idearc Media has made the decision to discontinue 28 competitive directory titles in Florida, Tennessee and Texas, and has eliminated 200 positions as a result. The company will also close nine sales offices, each associated with the independent directory titles being discontinued.

The company remains in the business of publishing independent directory titles and continues to publish them in 34 markets around the country. Idearc reports that in 2007 it published 1,200 distinct directory titles, including more than 1,100 in incumbent markets and more than 150 titles in markets where its former parent company, Verizon, is not the incumbent.

“We are very aggressive in our sales efforts, and these markets did not meet our expectations. Smart companies stay nimble and aggressively respond to market conditions, and that is what we are doing,” said Idearc spokesperson Mary De La Garza.

Total distribution for the titles that were discontinued is 7,607,729, according to Idearc. This is a fraction of the company’s 134 million total distribution. The sales offices closed are in Austin and San Antonio, Texas; Nashville and Knoxville, Tennessee; and Jacksonville, Hollywood, Homestead, Orlando and West Palm Beach, Florida. The company says it will continue to offer online products in non-franchise markets through adjacent incumbent directory sales offices.

The independent line of business accounted for about 3 percent of Idearc’s print revenues. In 2007, Idearc reported print directory revenues of US$2.9 billion, which placed the independent line of business in total at US$87 million. Therefore, the financial impact of this decision is relatively minor.

From a perception standpoint, the decision may have a somewhat bigger impact.

First, it suggests Idearc is taking action to eliminate underperforming assets and reduce its costs, which is widely seen as necessary given the company’s difficult financial position. However, De La Garza pointed out that the decision to discontinue these titles was in the works well before current CEO Scott Klein took over June 2.

The closing of the 28 titles also may reflect what will be a wider shakeout of independent directory titles throughout the industry. This may be particularly acute in regions like Florida, California and Texas, where there is a lot of competition and economic conditions are poor due to the foreclosure crisis. This will be a painful process, but it may ultimately benefit the industry, including Idearc.

The incredible rise in the number of competitive directory over the past decade has always seemed unsustainable, particularly given that competition doesn’t really grow the number of small-business leads generated in a market. Too much competition risked diluting the ROI any one publisher could offer its advertisers. This is doubtless more of a concern as economic conditions deteriorate. Less competition in a market will be the equivalent of opening a valve and releasing pressure. Those that remain in the competition will benefit, even if the discontinued revenues go to search engine marketing or to cover the small-business person’s rising cost of gas rather than to the publishers themselves.

This Post Has 8 Comments

  1. This is the MO of most new CEO joining a troubled business. Cut the fat. I’m sure this is just the first of many more cuts to come.

  2. Kelsey Group Blogs ? Idearc Discontinues 28 Independent Titles…

    Idearc Media has made the decision to discontinue 28 competitive directory titles in Florida, Tennessee and Texas, and has eliminated 200 positions as a result. The company also will close nine sales offices, each associated with the independent direct…

  3. This wasn’t fat. It was a corporate decision to elimate sales jobs in markets that were saturated by competition which the company felt that any Marketing dollars would be diluted.

  4. Fat, optmization, streamlining, right sizing, etc.. whatever you want to call it. The net effect is that people will be going out the door.

  5. Right decision, made too late. Could be a good idea to pay very close attention to major markets and forget the little stuff. Idearc still has plenty of fat that can be cut. Start in the marketing department, not sales.

  6. IDEARC doesn’t distribute 134 million directories. That’s the whole yellow pages community. IDEARC only
    distributes to 35 million homes across the country.

  7. “The financial impact of this decision is relatively minor.”
    Tell that crap to the over 200 employees affected, and the affect goes beyond the expansion markets.

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