How a Vegas stock broker outplayed the entire Yellow Pages Industry
(from the YPcommando archives. First published November 16, 2004)
Our story begins in February 1996. Yahoo had just gone public. Stockbroker, Dane Madsen had just moved to Las Vegas to open an office for Sutro & Co, Inc.
Dane was having trouble securing a office space lease, and was working out of a temporary space. In those freewheeling days, you could get absolutely anything you wanted in Vegas . . . except office space.
The Sprint Yellow Pages sales rep came to Dane’s temporary office. The rep gave him four days to sign the insertion order or “you will just have to wait for the next book”. Dane had been a buyer of Yellow Pages advertising for 10 years and knew how critical it was to be in the book. Sutro needed to be under five headings, but there was a pretty good chance that they wouldn’t be able to finalize their office location before the directory went to press. Being a bit of a gambler, Dane advertised under one heading because the risk of the address being wrong was less than not being in the directory at all.
In conversation with his old friend, Bill Povondra later that day, Dane commented how the web would change these things. Dane understood print cycles, but that the dynamic movement of business was going to embrace interactive in the future with a vengeance; static was going to see some change. Bill had owned an advertising agency in the past and was running a trade show company in Las Vegas. His understanding of B-to-B was enormous and his predictions for what we now know as supply chain management were well ahead of the curve.
Bill was on AOL at the time so Dane asked him to check if YellowPages.com had gone live. Dane reasoned that this would be the solution for the other four headings he missed. Bill discovered that there was no YellowPages.com. Another friend offered to find out how you registered domain names. He poked around and found out how registration happened. He also discovered that YellowPages.com was registered, but the owner had not paid for the registration. The url would be available in about 30 days.
They all understood that the Brand “Yellow Pages’ was powerful. They knew it was an instant icon for local businesses, and they knew that they could eventually do something with it. On April 6, 1996, the third partner registered the name for 2 years and got a little hosting package. For $130.00, the three amigos were in the directory business: And clearly over their heads.
It all happened because of the rudeness of the Sprint Yellow Pages sales rep.
In November 2004, SBC and BellSouth joined forces to purchase the domain name and company YellowPages.com for around $100 million. Prior to the sale, the most expensive domain name ever sold was business.com which sold for $7 million at the peak of the Internet bubble.
AT&T has made both YellowPages.com and now YP.com (a domain they purchased for around $3.5 million) into the backbone of their digital strategy. The Yellow Pages brand and Walking Fingers Logo (both in the public domain in the United States) continue to be one of the most recognized and respected brands in the world.
So with all of their smart people, you would have thought that someone in the Yellow Pages industry would have purchased the name before then.
Moral of the story: it isn’t what you have done that matters, it’s what you do.