Humble little Craigslist was started as a free service back in 1995 -- about the same time that visionaries in the newspaper biz were wondering if their papers should even be on the Internet.
Craigslist allows people to do transactions. You have an apartment to sublet? Don't buy a classified ad; you can post it for free on Craigslist! The site only charges to post job ads.
I said many moons ago the big threat to newspapers was their revenue dying the death of a thousand cuts. This CNet article via the NYT backs up that thesis:
An excerpt:
Free community Web site Craigslist has cost San Francisco Bay Area newspapers up to $65 million in employment advertising revenue, according to a report released Monday.
Craigslist, which generates more than 1 billion page-views each month, also has cost the newspapers millions more in merchandise and real estate advertising, and has damaged other traditional classified advertising businesses, according to a report published by Classified Intelligence.
"Craigslist has created an extremely important and valuable marketplace, and perfectly illustrates the changing nature of the classified advertising industry," Peter M. Zollman, founding principal of Classified Intelligence, said in a statement.
Online auction company eBay has taken a 25 per cent stake in Craigslist, according to the story. EBay also bought up rent.com.
One thing I should do some research on before I pop off more is what the newspaper biz has done to fight back against those who would so cruelly eat their lunch in this manner.
The Globe and Mail went into business with The Toronto Star to create the job site Workopolis, which has been a major success (its major competitor is Monster.ca -- an online-only company).
The Globe had MegaWheels to capture some of the online auto trade.
But I need to do more research to see what Canadian and U.S. newspapers have done in general to protect their revenue base.
Classified ads are a very profitable part of the newspaper business.
If that is significantly eroded, it changes the economics of the industry quite substantially.