Monster plans fee-based job site

By Anupama Chandrasekaran

NEW YORK - Monster Worldwide Inc. next month plans to launch an online community for users of its popular jobs listing site for a fee, but critics question whether the move will be successful.

The venture, already tested among some U.S. visitors to Monster.com, will be a part of the site and is a cross between increasingly popular networking and dating sites, such as Friendster.com, and job posting.

Industry analysts and rivals claimed that Monster was seeking other revenue streams after losing market share to CareerBuilder.com in the past year, but they doubt if the offering will make money.

"It shows that Monster is trying to do new things within the category to stay ahead of the pack, but it is not a venture that has much revenue potential at this time," said William Blair & Company analyst Matthew Litfin.

Industry executives argued that discussions on successful networking group should expand beyond just jobs.

"Online job seekers are looking for the best job opportunity, and if they want advice they would want it from someone they know and trust," said Dan Finnigan, general manager at rival HotJobs, owned by Yahoo Inc.

"The trusting and knowing doesn't come from meeting a stranger online who happens to work at the company you are looking at," Finnigan said. "It comes from being a part of a larger community and having people earn your trust."

But Monster claims the service will fill a demand. "Networking has always been the No. 1 way to find jobs," said Jeff Taylor, founder of Monster. "We are creating a compelling new way to match people."

TAPPING NEW REVENUE OUTLETS

While Monster's stock has more than doubled in the past year, job postings, a major source of revenue, haven't kept pace.

According to research firm Corzen, rival CareerBuilder ended 2003 with a higher number of job postings than Monster. For December, CareerBuilder had 44.1 percent of the average weekly job postings in the top 100 U.S. markets, while Monster lagged behind with 36.7 percent.

CareerBuilder is owned by newspaper groups Knight Ridder Inc., Tribune Co. and Gannett Co. Inc. The flow of job postings is also being slowed by Web sites that cater to specific professions. Also, companies are listing vacancies on their own sites.

But there is still decent traffic of job seekers to Monster, far more than CareerBuilder and HotJobs. The size of its user base plus a study that revealed a majority of its users found jobs through networking set the gears in motion for the new service.

"That became a no brainer for us," said Michael Schutzler, senior vice president of consumer products at Monster. "We have 30 million people in the U.S. and more than half of them get their jobs through networking. So we thought we ought to really let them talk to each other."

While users can search for contacts by profession, location and school, they will have to pay to be able to view contact information.

For the test period, Monster is charging a $24.99 one-time fee and a monthly charge of $2.99 for users to get in touch with each other. The fees could be higher, Schutzler said.

He expects job seekers and people looking to change jobs to use the service. Once a user finds employment, Schutzler hopes the person will use the networking service to stay in touch with peers.

But rivals disagree.

"Job search is more like buying a durable good," said Matt Ferguson, president of CareerBuilder. "You do it once every three years, and at that point you do a lot of investigation. Then you get a job and are no longer interested in communicating to people about networking."

Analysts don't see the service boosting Monster's revenues dramatically. "It won't become a major revenue driver for them," said Banc of America Securities analyst Marta Nichols. "Their core (business) will always be charging employers for posting jobs on their Web site and accessing the resume database."

® Reuters