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During the dark days of the IPO market in August, CitySearch attempted to go public, but market conditions were too hostile. Instead, the company did something very intelligent: It merged with Ticketmaster Online, showing good things can come out of bad times. Since then, the IPO market has roared back, and so has Ticketmaster-CitySearch, which went public recently. The underwriter is NationsBanc Montgomery Securities, and the ticker symbol is TMCS.

CitySearch is a provider of local city guides. The sites contain information about arts and entertainment, community activities, businesses, shopping, professional services, news, weather, sports, and so on. For example, you can get a map of a place you want to visit, send e-mail to a vendor, or even join bulletin-board discussions with local public officials.

The first local guide was set up in May 1996 and covered Raleigh-Durham-Chapel Hill, N.C. Since then, CitySearch has added local guides for Austin,Texas; Baltimore; Dallas; Los Angeles; Nashville, Tenn.; New York City, Portland, Ore.; Salt Lake City; San Diego; the San Francisco Bay area,Washington, D.C.; Copenhagen, Denmark; Stockholm, Sweden; Sydney and Melbourne, Australia;and Toronto. To help build local guides, CitySearch has partnered with local media companies -- usually newspapers. Its partners include The Baltimore Sun, TheDallas Morning News, The Los Angeles Times, The San Diego Union-Tribune, Washington Post/Newsweek Interactive, The Melbourne Age, Schibsted ASA/Scandinavia Online, The Sydney Morning Herald, and The Toronto Star. CitySearch also has partnered with Classified Ventures, the leading provider of online classified advertising. Classified Ventures uses content from eight major newspapers.

Ticketmaster is a household name, because it dominates the ticketingbusiness. The company went online in November 1996, and sold $270,000, or 0.1 percent of Ticketmaster's total sales, in its first month. By last September, the site had sales of $11.6 million for the month, 5.3 percent of total sales. The Ticketmaster site sells tickets for 16 Major League Baseball teams, 18 National Football League teams, 23 National Basketball Association teams, 20 National Hockey League teams, 10 Major League Soccer teams, and seven Women's National Basketball Association teams. In all, it serves more than 3,000 venues for sports, concerts, plays, and other entertainment. In conjunction with Intel, the company says it plans to create "My Ticketmaster," so users can customize the site according to their preferences.

Ticketmaster-CitySearch has a roster of major equity investors, including Goldman Sachs, The Washington Post, The Times Mirror Company, Compaq, American Express, AT&T, and T. Rowe Price. And Ticketmaster-CitySearch is a wholly owned subsidiary of USA Networks, which bought Ticketmaster in July 1998. CitySearch has lost an amazing amount of money: $308,000 in 1995, $13.9 million in 1996, and $36.5 million in 1997. In the first nine months of 1998, the company lost $27.1 million. But Ticketmaster has been profitable for the past two years, earning $2.3 million in 1996 and $2.5 million in 1997. But as a combined entity, Ticketmaster-CitySearch should have losses for quite a while. The merger resulted in a huge amount of goodwill reported, which must be amortized over the years. In total, there is $315.5 million in good will for Ticketmaster-CitySearch. Of this amount, $154.8 million will be amortized through 2008 and $160.7 until 2001.

There are good signs. Although there is plenty of competition in the local city-guide market -- from Microsoft's Sidewalk, Yahoo, and others --there is no doubt Ticketmaster dominates the event ticketing business. But that could change. At least one fast-growing company, called Tickets.com, says it plans to be the Yahoo of tickets. The company has strong venture capital backing and is planning for an IPO in 1999. Tickets.com owns the phone number 1-800-TICKETS. "Our domain name and phone numbers create incredible branding," says Scott Harvey, vice president of marketing. "We get thousands of calls per day and hundreds of thousands of unique visitors each month, without much advertising." However, Tickets.com will launch a multimillion-dollar advertising campaign beginning in January. According to Harvey, Tickets.com will have 50,000 venues and 140,000 events in its database by the end of the year. "We provide a complete service offering," he says. "If you plan on going to the Rose Bowl game, we can also reserve your flight and hotel."

Tickets.com also has a sophisticated technology infrastructure. "Our customer service reps have a browser on their desktops," says Bob Rieth, senior vice president of business development, "which is connected in real time to our databases and website. It is all seamless -- and this is very important. If you are on the road, you might not want to change your reservation using your laptop. Instead, you can use the 1-800-TICKETS phone number." But Ticketmaster-CitySearch also has an impressive management team. Alan Citron, the chairman of the board, was president of USA Interactive, as well as president and chief operations officer of Ticketmaster. Charles Conn, the CEO, headed CitySearch since its founding. Before that, he was a consultant for McKinsey & Co. The company's directors include Bill Gross, the founder of Knowledge Adventure, CitySearch, and eToys. Joseph Gleberman is a managing director at Goldman, Sachs, and Victor Kaufman, the founder of Tri-Star Pictures, was theCEO of Savoy Pictures. Then there's Barry Diller, who helped build the FoxNetwork and headed QVC.

From every angle, Ticketmaster-CitySearch would seem to be the leader in online ticket sales, and this is sure to be a hot IPO. But the competition isn't slowing down either.

Commercial: Readers interested in IPOs may want to check out The Investor's Guide To New Issues: How To Profit From Initial Public Offerings, available in our bookstore.