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Bill Gates Predicts End Of Yellow Pages

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Technology will advance so far for local advertising that when voice and data truly combine on mobile phones, the usage of venerable yellow page directories to find businesses will be near zero for anyone under 50.

Bill Gates Predicts End Of Yellow Pages
Bill Gates Predicts End Of Yellow Pages
Bill Gates Predicts End Of Yellow Pages

That might be news to publishers who drop hefty books full of business listings at doorsteps all over the country each year. Microsoft’s chairman Bill Gates, speaking at the company’s Strategic Advertising Summit, told attendees the age of the print directory has been numbered.

During his address, which took place with corporate VP and chief media officer Joanne Bradford on stage, Gates gave the example of calling for movie listings as an example of how information delivery could be better when voice/screen interaction improves.

When this happens, it should have implications in the local advertising market, Bradford observed. After that, the big change will come to the yellow page market. Gates explained to the audience:

Well, the Yellow Pages are going to be used less and less. We should be able, when you go to the service that’s going to take our technology and the Tellme technology that we acquired, when you say something like plumber, the presentation you’ll get will be far better than what you get in the Yellow Pages. After all, we know your location, and so we can cluster around that. We can take the information and show you the names, and then you can expand the information easily. So, yes, I think that these things always take time, but Yellow Page usage amongst people in their, say, below 50, will drop to zero, near zero over the next five years.

The ability to find local listings on mobile devices will have to become nearly as simple as flipping through a book. Once someone like Microsoft accomplishes that, more local businesses should embrace local online advertising.

Given Microsoft’s colorful history with regards to competitors, we have to wonder if the company thinks they have to win the mobile operating system market to succeed in local search. Microsoft may have to play nice with global handset leader Nokia to gain critical mass on the mobile platform.

With Google, AOL, Yahoo, and Ask all in the mix on mobiles, no one is going to just let Microsoft walk off with all the local ad goodies.

Bill Gates Predicts End Of Yellow Pages
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  • Elmer W. Cagape

    Just wondering if it’s a typo or intentional to leave off one “L” in Bill Gates’ name in the title.

    • David A. Utter

      I must have been channeling ‘Family Circus’ at the time.

  • GoldenBoy

    Don’t we hear this line every time a media company is trying to sell more of its mobile technology?

    The printed Yellow Page industry is a 16 billion dollar cash cow that has been told its “days are numbered” since the late 90′s. Despite the technological naysayers, the industry has a projected increase in revenues albeit slight. While usage of print Yellow Pages is expected to slowly trail off, forecats of usage remain well above the 50% mark.

    Remember that according to the Organization for Economic Cooperation and Development,(OECD) only 19.6% of Americans have broadband access and 30% of the US population do not own cell phones. (www.bridgeratings.com)

    • Mary Bowling

      Look out, the Yellow Page guys are moving into Search Engine Marketing with speed and stealth.

      They no longer just offer online versions of their print directories, but are packaging mini websites, preferred placement, pay per click and pay per call into bundles that the average small to medium business can understand and afford. And it’s sold to them by someone they know and are used to doing business with.

      As mobile search grows, so will their participation. For them, it’s a matter of survival and they know it. So, don’t count them out too soon.

  • Conan

    WOW, proudly spoken by someone who wants to sell you more tech that doesnt quite work. This is an idiotic claim by Bill. After all these years they still havent gotten windows to work quite right, how are they going to get this to work in five years and also put yellow pages out of business in that time frame.

    Even if the claim is true, people over 50 will still be using yellow pages and the majority of our population in the next five to ten years is baby boomers. That alone, based off his claim will make yellow pages even more profitable and the businesses who advertise in them.

    Now, take it from someone that works for print yellow pages, LOCAL INTERNET SEARCH ADVERTISING is to expensive for small to medium business. How do I know, our company sells pay per click advertising. Does it work, yep it works, drives business right to there website. How many phone calls do they get, not many. Nowhere near what they get from print yellow pages. The cost per lead from print yellow pages is a fraction of what the internet advertising is.

    Yellow pages isnt sexy, but it works like no other. It is still and will be for a very long time the best investment for the small to medium local business owners, period.

    • http://www.PensacolaBusinesses.com Mark

      Whilst Bill Gates may be trying to take over another hi-tech service, I believe he is on to something.

      Check out PensacolaBusinesses.com, a locally owned/operated directory. The YellowPages has NOTHING on these guys. They have superb search engine results, links to websites, email, television commercials, radio commercials, galleries of pictures for literally about a tenth of what it costs in the “traditional” directories. I use them in my business and for my personal use. I’ve not found ANY directory that does what they do for the price and quality. Take it from a business owner that isn’t paying out the nose but IS seeing results – results I never had with the paper directory. It, like the encyclopedia, is on the way out the door.

      The world is going (has been going) hi-tech for years and it’s only getting larger. The average family has 3 computers (desk top, laptop and some form of internet ready mobile device). Wifi everywhere. Cellphones liteally everywhere. Businesses are going “green” and “earth-friendly” and therefore moving toward a paperless era.

      It will take time but you can be sure Bill Gates will throw his money where he put his mouth. He’s been fairly successful thus far.

      • http://www.netyelloo.net Ken

        Bill is absolutely correct, the yellowpages directory will be a thing of the past, as we know it today. Our site is free and we’re offering to create a directory by co-op with the local advertisers. They will create and distribute their own local directory.The truth is the future of current yellowpage companies is bleak.

        • Guest

          Ironically, this is why the major Yellow Pages companies are leading LOCAL search through their  "On-Line" entities.  The best of them being Yellowpages.com (A little company called AT&T is behind it).  COMScore has them at the 30th most searched web site across the Internet.  That puts them ahead of numerous household names on the web.  They must know something, because they seem to be ahead of the curve.

    • Guest

      You’re fooling yourself my friend.  We track call out of yellow pages and off the internet.  Cost per lead for us is $185 per call on yellow pages and $12 per call off the Internet with about the same volume of calls and much better conversion.  Instead of spending $8000 a month on Yellow pages next year I will be spending $254 per month and focusing on other methods to generate leads. 

  • Steve

    Yellow pages focus on small to medium sized businesses. The VAST majority of which don’t even have a website today, much less highly interactive mobile content…it will happen eventually, but not in 5 years…maybe 15.

  • Dan

    What a ridiculous comment! Most YP references are for something that’s needed immediately. Ex Auto Repair, Leaky Toilet, Furnace not Working. Do you honestly believe that someone with no heat in the middle of winter wants to sit around and wait from some jackass to check job posts at 2am instead of a phone call?

    • Derek

      Phone and posting online are useful ways to find help and serve different purposes.

      Sometimes you need help fast but what makes you think a contractor is going to even take your calls or give a damn about your problems at 2am? All I know is that when my pipes froze a few years ago, there wasn’t damn plumber available who would help and no service, no yellow pages or anything else could have helped me. It was a bad time and the few guys I found didn’t want to leave their holiday cheer to deal with my mess. Was there someone out there who could help me? I don’t know because I couldn’t find them.

      Making random, desperate phone calls is also good way to get yourself a bad contractor who can easily take advantage of you.

      Some people like to know about the companies they are going to hire + plan ahead a little and that’s why services like Craigslist, Yelp, Workpost, Angies List, Kudzu are useful. Phone books are nice but this is 200X, we have cell phones, GPS, Google Maps and I hope the future is going offer people something better.

  • ScottR

    Not in 5 years.  The bigger issue is what’s happening to all types of print media, those that exist only for the sake of ad revenues they can attract.  He is right, but right in the largest sense.  In the next 5 years, there may only be one book around, the one that can buy the most of the smaller, more regional books, a phenomenon occuring now for years.  In 10 years, printed Yellow Pages will look more like the blue pages, and folks will likely be uploading answers onto their televisions.  Hand-held computers/PDA’s are still frustrating (size), and voice technology won’t be ready in five years to handle a volume of searches satisfied by print-media presently.  Very interesting stuff, though.  Every time I read an article like this telling me that the "geniuses" are thinking like I am, it does cause me to spend differently–creating, of subjects like this, self-fulfilling prophecy

  • Guest

      Yellow pages dying-Thats a laugh.  They aren’t dying, they are expanding.  Who do you think is selling the small business owner IYP, pay-per-click and streaming video?  Yellowpages.com the largest and Yellowbook.com in the top 5 of fastest growing websites.  Twenty years ago yellow page usage was at 84%, today at 61% – Try and find a Radio station, TV station or newspaper that can match these numbers.   Until the web experience becomes lightning fast & reliable no one is going to fire up the computer when the house is flooding to call a plumber.   Five years, doubtful, but when it does happen the major Yellow page companies are still going to be the major players.   To the guy who says that Yellow page leads cost him 185.00 per lead, your nutz!!  The average Yellow page display ad returns 12 times your investment and depending on type of business can swell to 50 times your investment.  The internet on the other hand can get you clicks all day long but actual sales lag miles behind Yellow pages with all categories except retail e-commerce sites.  I have a internet program getting 1100 clicks per month for my service business.  Last month I got 2 calls, no jobs.  Last month on a metered line in the yellow pages I got 98 calls, 61 of them turned into jobs.  The biggest drawback to yellow pages is the customer is only looking at your ad when he or she is ready to buy.  Thats a problem i can live with.

    • Guest

      I’ve been working in media for over 10 years.  Print media is declining at an alarming rate.  Newspaper circulation is at an all-time low.  The newspaper I used to work for is focusing all of its attention on the Internet and publishing its news online.  Businesses who don’t have websites are being left behind.  I left print media because there’s no future in it.  I have friends who’ve worked for the Yellow Pages and they say more and more big advertisers are dropping out because the cost of the product is increasing and the response is decreasing.  I work for a company now that combines TV and Internet advertising and I’d say 85% of our clients are former Yellow Pages advertisers who were spending $10,000 to $15,000 a month on huge Yellow Pages ads and getting fewer and fewer responses.  Ten or 20 years ago Yellow Pages was the way to go.  Now it’s not.  My customers now spend half of what they did with the Yellow Pages and are getting a better response and return on their investment.

      And have you seen the stock for the two publishers of Yellow Page books, Idearc and R.H. Donnelly?  About 16 months ago R.H. Donnelly’s stock was around $85 a share – today it’s at .78 (yes, that’s cents) a share.  Idearc’s stock was in the $45 range 12 months ago and today it’s at .36 a share.  If it continues like that they’ll both be kicked off the NYSE and become "Penny Stocks".  The next step for them both looks like bankruptcy.  Seems Bill is right on the money and that the Yellow Pages demise may come even SOONER than he predicted.

      P.S. – I’m a Baby Boomer and I NEVER use the Yellow Pages.  I can find anything I want on Google – and with a cable connection, my computer is up and available 24/7.  My phone book goes straight from my doorstep to my recycling bin.  There are communities nationwide that are trying to ban the Yellow Pages from even being delivered to people’s doorsteps unless the residents request them.  That doesn’t sound like a business that’s going to be around much longer.

    • Guest

      In Summary: You are horrible at advertising online so you think that flopping through a giant paper book is still better than a targeted search for a service on Google, Yahoo or MSN that takes under .008 seconds… You say your online ad campaign gets 1100 clicks a month and ONLY YIELDS 2 CALLS. The problem is not the advertising platform, the problem is that you are bad at advertising online.

  • jack

    So let me get this straight.  A pipe breaks in the bathroom and while it is pumping 7 gallons a minute unto the floor, you just fire up your google and start looking for a plumber. Your son cuts his finger to the bone. You lock yourself out of the car. You just broke a tooth off.  Its raining and the roof is leaking.  Fire up the old reliable dell.  Maybe when they actually get the computer to be a speedy reliable tool.

  • Brady

    Hey Bill, looks like you missed this one? Nearly 3 years later on a five year beat to zero and the industry looks pretty solid? I would stop focusing on yellow page publishers and start focusing on Microsoft. Your down to doing video games and windows…..that is nearly as old as the yellow page industry? Get a clue!

    • cliff

      Well here it is 2012, 5 years later and Bill Gates was right! San Francisco has banned the distribution of Yellow Pages this year, less and less people are using them, and people realize what a waste they are. The only people defending the Yellow Pages are the people that work there. The revenue from the Yellow Pages has steadily declined year after year, just take a look at your phone book from last year, if you even have one, half the size. And no idiot is going to take the time to thumb through a phone book while their house is flooding. I can look up a plumber on my cell phone in 10 seconds. It would take me that long jump to dust off my old phone book.