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PBL Feels The Heat as Online Rivals Step Up Advertising War
by Lara Sinclair, The Australian - Business

PUBLISHING & Broadcasting's online employment business Seek is facing renewed competition on both sides of the Tasman after publishers News Limited and John Fairfax both moved yesterday to increase their share of the fast-growing online recruitment advertising sector.

Fairfax, which bought New Zealand auction business Trade Me for $625 million in March, launched Trade Me Jobs yesterday, with plans to undercut market leader Seek's advertising rates by 66 per cent.

Trade Me, which attracted 2.6 million unique visitors in July, operates in four online classifieds sectors in New Zealand after branching into automotive and real estate in 2003.

Yesterday Fairfax corporate affairs spokesman Bruce Wolpe ruled out introducing the Trade Me brand to Australia, despite reports the company would launch parts of the website here.

"Trade Me is an NZ brand," Mr Wolpe said. "We have our MyCareer and Domain brands here."

Meanwhile, News Limited signalled its intention to compete more aggressively across the three biggest online classified sectors of recruitment, real estate and automotive, naming director of strategic development Stephen Hollings as chief executive of a soon-to-launch online recruitment business.

The as-yet-unnamed business, which will incorporate the CareerOne print and online advertising operations, is expected to offer richer services to both jobseekers and employers.

"This new business will develop new strategies aimed at winning a much larger share of the market," Dr Hollings said.

Fox Studios Australia chief executive Michael Harvey will become chief operating officer of News Limited's recruitment business, which will be part of News Digital Media.

News, publisher of The Australian, is also expected to launch new initiatives in the online automotive sector in coming months; it is already a shareholder in online real estate leader Realestate.com.au.

In Australia, the online recruitment advertising market is estimated to be worth between $140 million and $150 million, up from about $100 million a year ago.

Seek has about two-thirds of that market, and claims a similar share in New Zealand, where the total market is estimated to be worth about $NZ20 million ($16.5 million).

Online classified advertising is continuing to migrate from newspapers to the web, pushing traditional media businesses to explore internet options.

In Australia, classified advertising grew 44 per cent to $243 million in the 12 months to June.

In contrast, classified revenue in newspapers rose 1.4 per cent to $1.6 billion during 2005.

Last month, Fairfax and News ruled out merging their respective recruitment websites, MyCareer and CareerOne, after discussions failed to progress.