Last week, I was in Los Angeles for the latest Kelsey Conference (ILM 07). We heard presentations from many interesting speakers, most notably Jake Winebaum from RHD, Jay Herratti from Citysearch, Chamath Palihapitiya from Facebook, Stuart McKelvey from TMP, John Hanke from Google and the always interesting Jason Calacanis from Mahalo.

Once again, I had the opportunity to meet and discuss with many of my local search and directory industry peers, making this conference a must-attend if you’re in the local search industry. It took me the a few days to come up with takeaways from the conference, not because there weren’t any, but because they were embedded deeply in the zeitgeist of the whole conference and needed to be extracted. After a “disappointing” 2006 (as reported in this post from SES Chicago), I think we’re at a new inflexion point for the local search industry. It was almost as if every stakeholder in the room had realized that things were not as they had seemed to be and that they were being more realistic and pragmatic about online local search.

Without further ado, here are my takeaways from Kelsey ILM 07:

1. People are finally realizing that it is very difficult to “do” local. Both advertiser and user markets are very fragmented and local initiatives do not always scale. If you’re not “native” to the local search market, the learning curve is huge.
2. Clearly, the online local market has not been cracked yet. There is no clear winner yet and we’re still many years away from glory days.
3. Local is going to be huge online but the various stakeholders need to work together. Players have to identify where are their core strengths and weaknesses and partner to fill the gaps (either through aggregation of technologies, content or sales). M&A should be on everyone’s mind as well. Expect a very active 2008 on that front.
4. We heard the second reality check coming from a directory publisher in a couple of months. Time is running out and it’s now time to execute.
5. Verticalization is starting to happen. People are realizing that there are user & advertiser differences between yellow pages headings. We might finally see some real segmentation in the industry (headings-based pricing, vertical sites, specific ad products and content, etc.) .
6. Call-tracking/pay-per-call is now a strategic pillar of local. To solve the media fragmentation issue, this offers a unified business model to aggregate various products together and simplify the sales process.
7. Mobile is still the holy grail of local search, coming soon, but not in 2008. Maybe 2009.