Portals have the answers with advice services

The market for Web sites offering person-to-person advice and consulting services underwent a seismic shift last week with the entry of portal heavyweight Yahoo, which launched a free service linking questioners with people who claim specialized knowledge in various disciplines.

Yahoo's entry coincided with that of its distant competitor, NBCi, which jumped into the fray with an investment and marketing deal with an online advice service.

Additionally, how-to solutions site eHow.com today announced that it is partnering with Microsoft, taking a place on an enhanced version of Encarta.com, the MSN Network's learning channel.

The dual entries of the portals--which follow a similar launch six months ago by plain-language search engine Ask Jeeves--signal that regardless of their worth in delivering useful advice, so-called expert sites have graduated from the status of specialty Web destinations and could be on their way to becoming standard fare for the major portals.

That doesn't necessarily mean online expert services are poised for greatness. Portals have piled on various questionable services in a bid for breadth and as a way to buy traffic. Nearly two years ago, community Web sites were all the rage, and Yahoo dutifully plunked down $4.5 billion in stock to buy GeoCities--an acquisition that has left many analysts unimpressed.

The idea of offering consumers the chance to ask complete strangers for advice on topics ranging from computer trouble-shooting tips to personal hygiene is even more unproven as a business.

Even so, the entry of these heavy-hitters could spell trouble for the start-ups that cooked up the expert site concept in the first place, an already crowded field that includes Keen.com, Expertcity.com, AskMe.com and Exp.com.

"Suddenly a lot of companies are vying to provide this type of consumer experience," said Anya Sacharow, an analyst with Jupiter Communications. "With someone like Yahoo aggressively going after it...it's like Barnes & Noble moving in on the independent booksellers. They don't have the same infrastructure to survive."

The start-up expert sites paint sunnier pictures of their futures competing with Yahoo, pointing to unique aspects of their sites that they say will differentiate them in a more competitive market.

Keen.com chief executive Karl Jacob said likening Yahoo's and his company's offerings was an apples-to-oranges comparison because Yahoo sells advertising on Web pages with free advice, and customers pay Keen.com's experts to advise them over the phone.

"It doesn't change our competitive landscape at all," Jacob said of the Yahoo Experts debut. "There are people who want free advice, and there are people who want to pay for advice and get advice that is from a qualified person. People are willing to pay for value--I don't want to go to a free lawyer or a free doctor."

So far, Keen.com has proven Jacob to be right with 60 percent monthly revenue growth since April and a total of 700,000 registered members--though it remains to be seen if Keen.com will become a profitable business.

Yahoo Experts is a free service, and the company has no plans to facilitate the exchange of paid-for expertise. But it doesn't rule out implementing a voice-based advice system similar to Keen.com's service.

"What Keen does that we're not really in is the phone-to-phone bridging," Mark Hull, senior producer for Yahoo Experts, said in reference to Keen's method of joining two callers while protecting their identities and phone numbers. "We're looking at all sorts of ways to help people communicate with each other. Yahoo has its massive user base, so we expect to be a leader--very quickly."

Hull said that Yahoo would consider further integration of its existing communications tools and its expert site. The company already offers computer-to-computer communications through the Yahoo Instant Messenger and has a computer-to-phone service available in the test, or "beta," version of the messaging service.

Another start-up, Expertcity, says its focus on the narrow but in-demand field of computer technology expertise will insulate it from the Yahoo effect.

"It's the old adage: Get big, get niche, or get out," said Expertcity spokesman Omid Rahmat. "How do you get big compared to Yahoo? We're niche, and we're fine with that."

Skeptics scoff at the notion that the Web sites can guarantee person-to-person advice that consistently lives up to the expert billing. Sites including Yahoo Experts counter that customer ratings systems--similar to those that visitors to eBay and other auction sites use to evaluate sellers--ensure a threshold of quality control.

Expertcity has another level of quality assurance: Its computer technology experts are required to have certification from Microsoft and other software vendors before plying their advice on the site. Customers bid on their services in brief online auctions, and Expertcity takes a cut of the fees hammered out in those bidding sessions.

The company also makes money by licensing its technology for facilitating online computer help. It competes with another emerging group of sites devoted to online computer help.

While Yahoo's choice to build its own expert site may cost expert site CEOs some sleep, NBCi heartened small players that outsource their services when it licensed question and answer capabilities from Information Markets. Under the terms of what it called a multimillion-dollar deal, NBCi will integrate links to Information Markets throughout its search pages and some topic channels and will acquire a minority equity stake in the start-up.

Another Information Markets investor is America Online, which is keeping mum about any plans it might have for expert queries. Instead, the Net veteran says its existing online communities and communications tools provide ample opportunities for experts and questioners to exchange ideas and information.

"AOL was built on community, and today our members can find expert advice in chat rooms, message boards and through our partners on hundreds of different subjects ranging from health care to hobbies," said AOL spokesman Andrew Weinstein, who declined to say whether AOL was considering a more specific expert query property.

Ask Jeeves, which six months ago launched a free question and answer site, Answer Point, acknowledged that Yahoo's new offering could eat into its question and answer traffic.

"A lot of other people are now doing this," said Jonathan Silverman, product manager for Ask Jeeves' Ask.com. "It's a threat in certain ways, but it means it's coming to the forefront. I guess they'll take some of the users away, but (Yahoo's entry) validates the fact that it's a great thing, that people want to interact in a question and answer way. Jeeves offers that, and obviously people are buying into it."

In addition to Answer Point, Jeeves offers links to Exp.com, in which it took a "significant" equity investment in June.

Another search and navigation site that acquired expert-site capabilities is About.com, which in January purchased ExpertCentral.com in a stock transaction worth about $31 million at the time of the acquisition.