U.S. newspaper publishers may hate Craig Newmark. Some may blame him for destroying their business model, which relies on classified ads as a large source of revenue.
Who is Craig Newmark? He's the founder of Craigslist. He started a simple Web site in San Francisco in 1995 to e-mail events to friends and colleagues. He probably never expected his Web site to become the downfall of American newspapers.
Craigslist allows anyone to post an advertisement on their site for free. It's an amazing phenomenon that receives 3 billion page views each month and runs more classified ads than every U.S. newspaper combined.
With a staff of less than 20 people and sites localized for most of the major cities across the United States, Craigslist earns its millions in revenue by charging employers to post job openings. That's it. Every other post on the site is gratis, zippo, free, on the house, no charge, complimentary…
Newmark's business model is causing daily newspapers to reconsider their sources of revenue.
But Craigslist is about so much more than just making money. It serves as a symbol of how people want to get their information...faster and cheaper. And newspapers are slowly recognizing the trend.
But, signal one round to the newspaper folks. Chicago just filed a lawsuit against Craiglist for violating federal housing laws with its rental ads. Apparently, "Neighborhood predominantly Caucasian, Polish and Hispanic" might be discrimination.
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