I was at SES Chicago yesterday moderating a couple of panels, sharing duty with my colleague Mike Boland on the local track presented by The Kelsey Group. My first opportunity of the day was to interview Charles Stubbs of Yellowpages.com. Those who were there benefited from a wide-ranging talk about how YPC is doing, why it bought Ingenio and what Stubbs’ long-range vision is for the Internet Yellow Pages platform.

One of my first questions was whether the operation sees itself primarily as a destination site or a sales channel selling access to a distribution network (my first impulse was to ask if YPC is a dessert topping or a floor wax but didn’t want to date myself with a mid-1970s’ “Saturday Night Live” reference). Stubbs’ response was essentially that he wants to deliver customers leads, and doing so requires both a branded presence and access to distribution on other platforms.

Stubbs also talked about how the YPC model is moving gradually toward one in which it sells access to leads (mostly phone calls) that are provisioned across multiple platforms and supported by call measurement. The Ingenio deal offers YPC a platform to fulfill this vision. Mike Boland will post more on the Stubbs interview later from his notes (I was too busy figuring out my next question to record much of what Stubbs had to say). RHD sings a similar song with its “triple play” strategy.

Later in the day, I moderated a session on how small businesses are being brought online and engaged in local online advertising. R.H. Donnelley, Marchex, Local.com and Website Pros were represented on the panel.

Justin Sanger from RHD (via its acquisition of Chicago-based LocalLaunch) had a number of compelling things to say. One was that despite all the investment in technology at the local level, it is contact with the local channel that drives the experience of small businesses with search engine marketing.

He also said the level of fragmentation in the local market today cries out for consolidation since there simply will not be enough margin to go around if too many parties take a piece of each dollar spent online by local advertisers.

What was clear from this session is that despite all the investment and energy going on in local, (bad sports metaphor alert) this game is at best in the bottom of the first inning. As Sanger put it, “innovation is ahead of SME adoption.”

Rather than being discouraged, the panelists agreed this signals tremendous opportunity.