Reborn Shopping.com is product-comparison site

SAN FRANCISCO -- Shopping.com, a once-prized Web address dumpedinto the Internet's bargain bin two years ago, is being dusted offfor another audacious business plan.

DealTime Inc., a profitable survivor of the dot-com shakeout, hasadopted Shopping.com as its new identity in hopes of establishing itsproduct-comparison site as an e-commerce cornerstone.

"We want to be mentioned in the same breath as Amazon.com andeBay," said Nirav Tolia, chief operating officer for Brisbane, Calif.-based Shopping.com Inc.

The lofty goal -- and name change -- reflects the gains thatproduct-comparison sites have made as more consumers and merchantsdiscover how useful the services can be. Consumers have been flockingto Web sites like DealTime, NexTag, PriceGrabber and BizRate becausethey all provide potentially valuable information about a potpourriof products.

The sites typically include free side-by-side comparisons of thesame products made by different manufacturers, as well as the pricesoffered by different merchants and consumer reviews.

Meanwhile, merchants have embraced the sites as an inexpensive wayto attract customers. The sites don't sell the products displayed ontheir sites; they generate most of their revenue from salescommissions paid by merchants who benefit from the referrals.

The approach has turned into a money maker. Privately heldDealTime says it has been profitable since late last year. So is itsrival, NexTag.

The 4-year-old DealTime is trying upstage Yahoo by retooling itssite and taking on the new domain name. It picked up Shopping.com forless than $500,000 two years ago from online search engine AltaVista,which was shrinking during the high-tech meltdown.

Since then, DealTime had been using Shopping.com as a bare-bonessearch engine site focused on retailers. In its overhaul, DealTimehas united all its services, including product reviews from Epinion,under the Shopping.com label.

With a name that promotes spending, Shopping.com was viewed as apotential gold mine near the peak of Internet mania. In January 1999,Compaq Computer -- AltaVista's former owner -- paid $257 million forShopping.com, which at the time was a struggling company that lost$56.6 million on revenue of $9 million during its first two years inbusiness.

AltaVista wasn't able to do much with Shopping.com either, butDealTime is convinced the name will thrive this time, with e-commerce growing steadily.

About 25 million more U.S. households will begin shopping onlineduring the next five years, increasing the country's e-commerceaudience to 63 million by 2008, according to a July analysis byForrester Research.

Online shopping will generate sales of $230 billion in 2008, upfrom $95.7 billion this year, Forrester projects.

The growth bodes well for online comparison sites if they canraise more consumer awareness, said Forrester analyst Carrie Johnson.

As it is, Johnson said most consumers still find e-commerceinformation through the search engines provided at Yahoo and theWeb's other most popular destinations -- MSN, AOL and Google.

The product comparison services "are all in a mad dash" to attractmore traffic, Johnson said. "While there are certainly a large numberof consumers who would find the services extremely valuable, thetrouble is, most people still don't even know the sites exist."