Well, that is an excellent site! A very good example of how to do a local portal right. I really like the classifieds, messages, gas prices, weather snippets all appearing on the front page - I can see why a lot of local people come to that site. You even have personals, lol!
As far as competing with advertisers - I wouldn't worry about that one little bit. Advertising and selling product are two different things. As long as you don't have advertisers for the same products that you are trying to sell, it isn't competition at all, imho.
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