Yahoo, a massive database created and maintained by two Stanford University students (http://www.yahoo.com), last week said it received funding from venture capital firm Sequoia Capital and will soon start to sell advertising slots.
Yahoo earlier this year formed a relationship with Netscape Communications Corp. under which Yahoo will carry the Netscape logo on its first page and Netscape will route users of its browser to Yahoo.
"Because we are now backed by a third party, there's pressure to produce. Yahoo will have to become a money-making enterprise," said 28-year-old David Filo, one of the founding partners. "We're not sure if we want to start reviewing sites or continue to just list sites in a comprehensive fashion, but we are definitely going to integrate advertising into what we do."
The company has been in talks with Poppe Tyson, New York, the agency handling the Netscape site, but says ads won't appear on the directory for several weeks.
Marketers that will advertise on Netscape's home page include MasterCard International and General Motors Corp.
As in most races, however, it's usually the fleet of foot that wins. And some Internet guides are already a step ahead-at least in the advertising game.
"There will most definitely be a battle for Internet directory services," said Rick Spence, online analyst with San Jose, Calif.-based Dataquest. "Guides that offer the most information and make it easy without overwhelming people will get the most traffic and be the most successful, partly because their space will be attractive to advertisers."
Point Communications, Brookline, Mass., will launch its Point Survey on April 24 at http://www.pointcom.com. The Internet guide will allow users to participate in the rating of up to 2,000 sites each month.
Point has also crafted sponsorship deals for different sections of its guide, like shopping, leisure and travel, arts and entertainment, business, computers and education. Coors Brewing Co.'s Zima will pay $2,700 to sponsor Point's home page for its first week online, followed by Southwest Airlines, which will sponsor the home page during its second week.
"Most Internet guides 'til now have been written by techheads for techheads," said Chris Kitze, president of Point Communications. "We're looking at cross-pollinating marketing and technology and becoming consumer-friendly."
In addition to marketing its service through traditional print media like Internet World and Wired, the company is close to signing contracts to be listed on the browser home pages of the major online services. Point is also working closely with agencies including Modem Media, Westport, Conn. (Coors' interactive agency), to create new ways to market products.
"There will be room for three or four rating services out there," said Mr. Kitze. "The question will be who do people trust and who do people like."
Yet another company, Berkeley, Calif.-based McKinley Group, today launches its own comprehensive online directory at http://www.mckinley.com. The guide offers detailed information, including descriptions of thousands of Web sites written by correspondents around the world.
For as little as $200 annually, advertisers that are thematically relevant to a given site can also buy space on the guide.