New players in the space include Qype, a local directory service, which has attracted a former senior Yahoo! executive, and Bview, which is bringing the killer application for the recession – vouchers – to local communities.

Yell offers an opaque ROI to the local drycleaners or restaurant and doesn’t really enable them to take control of their profile online. Customers of local businesses want to praise great service. Why haven’t Yell figured this all out yet?
Two main reasons. Migrating from a cash cow business to a new frontier in almost any sphere is tough, but also, the speed with which one needs to iterate online is uncomfortable for a large organisation.

Most consumers spend 80% of their disposable income within 10 miles of their homes. A lot of money is up for grabs.
BView saw the opportunity to help consumers support local businesses while helping local businesses target local customers. BView’s founder Brad Liebmann, who previously built Decision Finance, the UK’s leading price comparison service for financial services, is making the economics work for the local business ecosystem: everybody gets a cut of the transaction.

Using the BView platform, consumers can search for the local business they require, read the reviews and then find those with the best offers. Businesses now have an online distribution mechanism for their promotions.

Brad said recently: “We don’t get it right all the time, but we move fast to fix it when we get it wrong – that’s the key to success online.” Established players can never compete with start-ups who can make product releases in a couple of weeks instead of half a year.

BView has really thought through what it will take to build the local business ecosystem. First of all, don’t compete with other content providers; embrace them. Secondly, build from the bottom up; treat local businesses the same as national chains. Thirdly, don’t charge local businesses to go online. Build on the proximity of a customer to a business rather than post code. Push advertising out only to those target customers who have expressed an interest.

Once again, we see that there is a profound and fundamental network orientation to 21st century business. Whereas Qype focuses on helping consumers, Yell focuses on businesses without the best online tools, but BView bring the two together, and aligns the economics for the whole ecosystem.  And bottom-up movements and business models have power – witness Obama’s grass roots effort, or any other reshaping of offline business to online.

This is a winner take all space, and the smart money is not on Yell to make the jump to the new battleground.