Post by Michael Arrington saying that Insider Pages is laying off about 2/3 of it’s staff. It’s a shame to hear that but it speaks to the challenges inherent in the local reviews business. The fundamental issue about getting dollars out of local businesses is the cost of sale problem. Acquiring a significant number of local advertisers is expensive. You either do it via direct marketing or via telesales. Both options are expensive. Small business owners are busy people and very few of them are spending money on online marketing. The few that are, are definitely early adopters. Unless you have a sales force with existing relationships, such as the Yellow Pages, getting dollars out of local businesses is hard. Note, that if like Yelp, you have user traction, you can still get a decent exit. Building revenues to a respectable number continues to be difficult. There’s no question in my mind that a review supplemented directory service does more for consumers than the offline yellow pages, but a business that makes significant revenue doing that is pretty far away.