Craig: A wolf in geek's clothing?

By Dominic Ponsford

Internet classified advertising guru Craig Newmark has his "tanks on our lawns" and has a business model that "threatens to wipe out newspapers around the world".

This was the warning issued by Guardian editor Alan Rusbridger as he made his inaugural talk as the first Hugo Young visiting professor of modern history at Queen Mary College, University of London.

He also conceded that public figures should discuss new ways of funding newspapers if the economic situation became "really desperate".

Rusbridger said he loves newspapers, but compared them to second-hand bookshops and drew parallels with the threat posed to them by the internet.

He said: "Two years ago I discovered abebooks.co.uk — where you are more or less guaranteed to find any book in the world. When you search the site you are simultaneously linked to 13,000 bookshops around the world with a total inventory of 17 million books.

"I suspect if a local bookseller is going to survive he is going to have to change his business model, embrace the internet and change everything he’s done in his working life."

Rusbridger suggested that the equivalent threat to newspapers could come from Craig Newmark, whose free internet classified advertising board, Craigslist, now has 10 million users and is established in 190 cities worldwide.

He said: "For two or three hundred years newspapers made money from a combination of cover price and advertising… all that’s changing thanks to this man… he’s found his own publishing business model which threatens to wipe out newspapers around the world."

He added: "Craig Newmark has his tanks on our lawns — it’s fair to say he hasn’t caught on in our cities in a big way, but he doesn’t do any marketing."

Rusbridger said that serious journalism is "an expensive business" and by providing adverts without editorial, Newmark has "disaggregated journalism from advertising, disaggregated the cost centre from the profit centre and he just does the profit bit".

He said: "From property to cars to travel to jobs there are hundreds and thousands of would-be dotcom millionaires working out how to dismember newspapers into smaller and smaller fragments, each of them potentially incredibly lucrative in their own way.

"However much we love newspapers, it’s not entirely clear how they can go on doing the things they have traditionally done if the main planks of their economic existence are being gradually — or not so gradually — kicked away."

Press Gazette put Rusbridger’s concerns to Craigslist CEO Jim Buckmaster. He said: "Our 19-person team at Craigslist does not threaten the viability of newspapers, but I do suspect that we’ll see journalism continue to migrate to the internet."

Rusbridger said that The Guardian faces similar competition editorially from the many specialist websites. And in the area of comment, from the 27.1 million blogs currently registered by blog search engine Technorati.

But Rusbridger said that there will always be a need for journalists: "You could drive every last newspaper out of business and still there would be a hunger and a need for what — at our best — we do.

"The skills we have as journalists, the ability to gather, to verify, to sort, to investigate, to contextualise, to analyse, to challenge and to aggregate will always be in demand in any society.

"What we do still matters and journalism is still important. We must never ever lose the confidence — almost everything else is going to change."

When asked if he could foresee a time when newspapers would need to have state subsidies, Rusbridger said: "If we got to a point where newspapers were simply not economically viable you would hope there would be some kind of debate in the country."

But he added: "Some of the papers in the red-top and mid-market tabloid market are showing a failure of nerve and retreating from news and selling themselves on entertainment.

"I think it’s quite difficult to make the case that reading some of those titles is an essential part of being a citizen. You would hope if things got really desperate, people in public life would start thinking about an economic model that would sustain us."

Craigslist
THE FACTS

The website started in San Francisco in 1995 as a "non-commercial community bulletin board"

founded by software engineer Craig Newmark, who spent 18 years at IBM.

Craigslist employs 19 staff at a Victorian house in San Francisco and makes its money by charging between $25 and $75 for certain types of job adverts.

Its 2005 revenues according to Fortune magazine were in the region of $20 million.

According to one study, Craigslist cost newspapers in the Bay area of San Francisco up to $65 million in lost revenue from employment advertising in 2004.

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