Invasion of The Yellow Pages

By Janice Castro

It used to be simple to find a plumber, a taxi service or just about any other business around town. Most people simply took out the Yellow Pages and let their fingers do the walking. But these days, the searching shopper must first decide which phone book is likely to have the best answer. Like the good old telephone system, the plain old Yellow Pages has changed considerably since the 1984 breakup of AT&T. Consumers now choose from a virtual home library of competing Yellow Pages, including special editions for children, the elderly, doctors and boaters, and even multilingual versions in Spanish, Chinese and other languages. At the same time, firms like Southwestern Bell are going nationwide to challenge other phone companies for consumers. Says C. Richard Stigelman, a Swarthmore, Pa., telecommunications consultant: "Under divestiture, the directory business has started to become an industry."

Though nine big operators -- the seven regional Bell companies, Reuben H. Donnelley and GTE Directories -- accounted for more than 90% of the industry's estimated $7.4 billion in advertising revenues last year, about 200 other ( publishers now produce their own brands of Yellow Pages. Many companies buy listings in more than one telephone book to make sure that potential customers see their display ads. As a result, the Yellow Pages is one of the fastest growing advertising media in the U.S.

The proliferation of Yellow Pages has transformed a quiet business that had changed little since the New Haven (Conn.) District Telephone Co. published the first such directory in 1878: a one-page roster of eleven residences and 39 doctors, factories and other commercial listings. Since neither the name Yellow Pages nor the walking-fingers symbol is a protected trademark (they passed into generic use long before AT&T's divestiture), anyone can employ them. Many consumers no longer know whose directories they are using. Southern Bell calls its 242 editions the "Real Yellow Pages," while other publishers have adopted distinctive names in order to stand out from the crowd. GTE, for example, publishes 51 editions of the Neighborhood Phone Book. Nobody knows which editions consumers use the most when they are faced with a choice, but industry-wide surveys to sort out such preferences are getting under way.

One of the largest and most aggressive directory publishers is St. Louis- based Southwestern Bell. The company puts out 1,100 Yellow Pages editions in 48 states and has launched major invasions of the Manhattan, Baltimore, Washington and Chicago markets. In Manhattan, Southwestern Bell has taken on NYNEX, the giant holding company for the New York and New England telephone companies. Since last year, more than 1 million copies of Southwestern's New York Yellow Pages have been distributed. The 816-page book is a more compact alternative to the listings contained in two separate NYNEX Yellow Pages directories -- the consumer version and the business-to-business edition -- which together run to almost 4,000 pages.

Other top markets are being invaded by Donnelley, based in Purchase, N.Y., the largest non-Bell marketeer of Yellow Pages in the U.S. Donnelley, a longtime sales agent for several Bell publishers, still sells advertising space for some 50 phone companies. Now the firm is aggressively courting customers in Pennsylvania, California and other states with 90 editions of its own, as well as numerous phone books co-published with other firms. Says Bob Dahut, general sales manager for Bell Atlantic, the holding company for Bell of Pennsylvania: "Donnelley is a formidable competitor. They've got the knowledge and the sales force."

Dallas-based GTE Directories publishes phone books in 42 states, from Alaska to Florida. While many of its competitors are concentrating on major cities, GTE is going after customers in suburban and rural areas. During the first six months of this year, GTE increased its directory revenues by 11% over the same period in 1986.

For many of the industry's publishers, specialized Yellow Page editions are a way to boost market share or carve out a new niche. In the San Francisco Bay Area, for example, Direct Language Publishing distributes four editions of its Asian Yellow Pages -- two in Chinese, one in Japanese and one in Vietnamese -- to the thriving immigrant communities there. Manufacturers in five Midwestern states can turn to Ameritech's Industrial Yellow Pages, a business directory so technical that the Ohio edition lists 22 different entries for ball bearings. And where but in the Los Angeles Children's Yellow Pages would one expect to find nine entries for doll hospitals?

With reporting by Wendy Cole/New York and Lisa Kartus/Chicago