Irvine based Local.com is an interesting public company.  It is a local content and search aggregator, that launched back in 2005.  They've been making headlines in the last few months with a major patent approved for local search, as well as partnerships to aggregate business review content from the two biggest user generated content sites: Citysearch and Yelp.


Between the domain name and the fact that their poring millions into advertising to buy users to their site, they have great traffic, with at least 5 million monthly users.  Now here lies the rub, local.com is essentially just a geographically focused search engine, and in some ways competes against the likes of almighty Google.  For example if you are looking for a mexican restaurant in Los Angeles, they will give you indexed results of mexican restaurants in LA.   Google similarly does this in their business map section.  In both cases they are search focused, meaning that the actual content doesn't originate from Google or Local, it merely is indexed from other sites like CitySearch or Yelp.  What makes this interesting, is that Google can run local search as an extension of regular search and can afford to build a similar product, without having to 'buy' customers.  Local.com can't do that, and has to resort to paying a hefty chunk in advertising to get people to its site.  But being that its a search engine, people are leaving the site as soon as they find what they are looking for.  Those people are then spending their time on a place like citysearch where the real content is.    Ultimately, this makes Local.com's business model questionable, they are paying for people who are not really engaging their site. 

While I'd be the first to agree about the huge advertising potential in local revenue, local.com is bleeding far to much money, to really make geographic advertising work.  Further, as a company that doesn't offer its own unique content, its pinned up to fight against Google.  Now I know theirs chinks in Googles armour, but you have to have a far more revolutionary product if you are going to go up against them in the search space.  While locals resuts are maybe a bit better then Googles, its certainly not enough to convert users. At least not this user anyways.