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Ticketmaster pursues life after Lycos

Chief executive Charles Conn sniffs around for acquisitions in the wake of the aborted Lycos deal.

The aborted Lycos deal behind him, Ticketmaster Online-CitySearch chief executive Charles Conn is scouting for acquisitions to boost the e-commerce capabilities in his company's stable of city-specific sites.

On May 15, Ticketmaster Online-City Search paid $50 million in shares for Match.com, an Internet dating service, and now it's looking for new relationships.

In fact, analysts think scuttling the Lycos deal will be a positive for Ticketmaster-City Search.

"Ticketmaster was blessed by the collapse of the merger," said Peter Krasilovsky, analyst with Kelsey Group, which follows local directories. "It was able to salvage a strategic partnership with Lycos that gives it everything it would have been able to do under the formal merger."

No longer distracted by the ill-fated, three-way merger of Ticketmaster, Lycos, and Barry Diller's USA Networks, which owns 58 percent of Ticketmaster Online-City Search, Ticketmaster chief executive Charles Conn is moving on other fronts. Although he's cagey on specific deals, he's clear on the goal.

"We are not even half way done with things we would like to do to make Ticketmaster-City Search more practical," Conn said. "It's really about getting stuff done. As Web users have matured, people are much more interested in tools to get things done. They're looking for tools and information about their own cities."

For example, the company is developing its own capabilities to offer job classifieds on its sites, Conn said. Partnerships would include home deliveries of groceries, videos, and liquor, probably through deals. TV shopping channel Home Shopping Network, owned by USA Networks, has merchandising, fulfillment, and customer support that Conn's organization can draw upon.

"They are certainly on a roll since merging with Ticketmaster a little less than a year ago," said Forrester Research analyst Lisa Allen, a deal she calls "manna from heaven for City Search. "That's really what has distinguished it from other city guide wannabes. Not every body has Ticketmaster."

She expects the company to push further into local e-commerce, other services, and job listings, which it's testing now in San Francisco. Expanding its local auctions is another possibility.

David Crowder, an investment banker at Thomas Weisel Partners who works with Ticketmaster-City Search, would add services like renewing drivers licenses, reserving tee times at the golf course, or buying movie tickets, not just event tickets.

"Conn likes to say that people spend 90 percent of their time and money within a few miles of their home," Crowder added.

"Buying Match.com and CityAuction fits this strategy in that these are very popular online activities that frequently have a local component," Allen added, calling them complementary services that fit naturally on local sites. "If you want to meet somebody online for date, you won't want to jump on a plane to meet that person, but you'll go to the corner bar."

Krasilovsky says the Match.com acquisition points to the rising importance of singles and personals in the local market, noting that personals are the top content category for local sites such as America Online's Digital City.

Historically Digital City and Microsoft's Sidewalk sites have been CitySearch's biggest competitor, but Conn said he's less worried about them than he was a year ago. He sees them moving in different directions.

"Sidewalk has moved to a Yellow Pages, buying guide product. That's smart for Microsoft--it's more Redmond-driven, software-driven, and database-driven," Conn said. "As for Digital City, it's hard to tell what they're up to. It's mostly link-based content with not a bunch of local people in cities. Nobody wants to count AOL out, but we can definitely handle the competition."

Still, Krasilovsky thinks Ticketmaster-City Search, despite a huge jump in revenues in its latest quarter, needs to boost its traffic.

"It gets a couple look-ups per month from about 5 million people spread out around the world," he said. It will need to increase penetration and frequency before it is truly a valuable property that can drive traffic to storefronts and other areas under its umbrella."