Newspaper baron turns to online auctions

Irish newspaper baron Tony OReilly has come up with a novel idea to fend off the threat from online classifieds to his newspaper group.

His Independent News & Media newspaper group, which includes the Evening Herald in Dublin, has launched an online auction service called iBid.ie, which invites readers to bid online for everything from furniture to jewellery and even hair implants and consmetic surgery. Over 250,000 Euros of goods were advertised in the first auction and promotion started with the distrubution of 90,000 printed cataglogues to commuters in Dublin.

The deal for advertisers is unusual but is described as a "win, win situation" by the group. If the reserve price for an item is passed, the newspaper keeps the profit but provides the equivalent value in advertising space to the seller in return.

So far, the project has been deemed a success with The Herald reporting "a lively response" with thousands of users registering. Although new to Ireland and novel in the way the newspaper makes money, the concept has been tried before, being first pioneered in Canada. O'Reilly has also tried the concept in one of his newspapers in New Zealand, and north of the Irish border the his Belfast Telegraph evening newspaper is planning to have a go.

Like many media owners, O'Reilly believes that newspapers are at a watershed with the rapid growth of web-based news and information services, and is focused on trying to find ways to survive and thrive into the future. And like Rupert Murdoch of News International, he has spent the last year working on a "cyber land-grab" operation. The group recently launched loadza.com in Ireland and bought Northern Irish property web site Propertynews.com. Other investments include online gaming service Cashcade, and a stake in online poker site Getminted.