Joho the Blog
An Entry from the Archives

MediaPost's MediaDailyNews runs a story by Ross Fadner with this headline:

This is based on an article in Classified Intellligence Report about eBay buying 25% of Craigslist:

Like a certain hockey-masked stalker from Camp Crystal Lake, Craigslist threatens to slice into newspapers' employment and real estate advertising strongholds. Add the huge promotional power of Meg Whitman and her team and this is one horror flick you don't want to see.

The editor of the report, Peter Zollman, seems to me to get it right: "Craigslist is not the threat; it's a symptom or a reaction to the threat." The "disease" of which Craigslist is a symptom is the growth of the Internet and the decline in interest in print newspapers. "Newspapers have lost their role as the marketplace [for classifieds]," Zollman says in the MediaDailyNews article. "Craigslist is the new marketplace."

Without irony, the little ad to the right of the MediaDailyNews headline reads:

Every day MediaPost Classifieds list dozens of prominent media planner, buyer, seller and marketing positions.

Fun facts from the article: CraigsList's 45 regional sites get a billion page views monthly and 5 million unique visitors. Classifieds account for 40-45% of a newspaper's advertising revenues, or $15.8 billion dollars per year in the US. Craigslist's annual revenues are guessed to be $7-$12 million/year. Craigslist does not advertise, relying on word-of-mouth.

And the article says the following about eBay's plans:

According to eBay spokesman Hani Durzy, the company bought the minority investment in Craigslist to learn more about online classifieds and how to reach local markets. We're learning more about the classifieds market... what these are, what it is that makes them tick," Durzy told theCIR.

Zollman believes that in the short-term, eBay's involvement in Craigslist will be minimal. In the mid-term, he said he expects eBay to aid the classifieds provider in its expansion efforts, eliminating the scams that permeate the service, and implementing new technologies. Zollman doesn't expect eBay to fund promotional efforts, at least in the near future.