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MS holds off on want ads

Microsoft will hold off on controversial plans to compete against newspapers for classified advertising with online entertainment guides in several U.S. cities.

Microsoft (MSFT) will hold off on controversial plans to compete against newspapers for classified advertising with online entertainment guides in several U.S. cities.

The Redmond, Washington-based software maker will tighten its focus exclusively on entertainment-related ads and information in the guides under its code-named Cityscape project, the Wall Street Journal reported today.

The decision comes as many U.S. newspapers and telecommunications companies have gone online with their own city guides, beginning what is expected to be a fierce battle for an estimated $60 billion in local advertising.

Striking a more cooperative tone, Microsoft said it will limit classifieds to entertainment-related ads and information, adding that it will continue talking with newspaper executives about possible information-gathering partnerships. The company remains committed to its MSNBC news and online venture with NBC.

Microsoft plans to debut its first Cityscape service in Seattle during the first quarter of next year and launch guides in New York, Boston, and San Francisco by mid-1997.

In a related development, AT&T said today that it is closing its Home Town Network, a service delivering local government and entertainment news and classified ads. The telecommunications company had been testing the service in Sacramento but has decided that a similar national service would be too expensive.