31 October 2012
Press ReleasesThe woes of Hibu plc (formerly Yell) are becoming rather public. Although cash generative, Hibu reported a pre-tax loss of £1.4bn for the year ended March 2012 because of write downs in intangibles. It also suffered a fall in revenues of 14% in that year. Now it faces difficulties with the rescheduling of more than £2bn of debt following a default on £65m this week.
In part, this is because the creditors, who have suffered the default on funding provided in 2006, including Barclays, are threatening to bring winding up proceedings against Hibu. The question that springs to mind, however, is what the future holds for directories such as Yell.
Initially many, no doubt, felt that the coming of the digital age would boost the business models for data providers such as Yell. Instead of printing bulky paper volumes - which would rapidly go out of date - the directory providers could allow users to access up to the minute data online. Because of this advertisers might be drawn in by the prospect of being able to target advertising space in one of any number of ways. All of this could create a virtuous spiral improving revenues and profitability.
But in reality, have not directories now been overtaken by the power of search engines such as Altavista, Bing, Google, Live Search, Safari and Yahoo? Why should users bother with a directory when, with a few keystrokes, they can go directly to the website of any business using their preferred search engines? If that is the case, why should businesses themselves bother to advertise in directories – beyond, perhaps, retaining repeat, minimum, no-cost, one-line entries.
Is one not led to ponder, therefore, whether - irrespective of the outcome of the current attack on Hibu - directories have not simply had their day?
