Craigslist: paid classifieds killer, or impetus for more lucrative classifieds business

When I interviewed Craig Newmark a few weeks ago about the impending introduction of fees for some New York City real estate listings at his namesake Craigslist (see here for my interview), Newmark stressed how he helps rid the site of “bad behaviour” in his role as chief Customer Service representative.

As the day to day operations of Craigslist are run by Jim Buckmaster, CEO, Newmark spends much of his time trying to police predatory and illegal activities transpiring at Craigslist: scams, harassment, prostitution…

Newmark works closely with the Internet crimes divisions of the New York and Los Angeles police departments to track down people using Craigslist to engage in illegal activities. According to Newmark, the most egregious of behavior at Craigslist involves criminal activities originating from Eastern Europe, Western Africa and Washington DC.

Like other Internet sites promoting open access and participation, such as MySpace, anti-social behaviour is a problem at Craigslist, same as in the offline world. Unlike perhaps other sites, however, Craigslist balances the need to provide a safe, legal environment, with a wish to be inclusive and “compassionate.”

So while the use of Craigslist in the promotion of illegal prostitution is strictly policed, more “innocent” (but still “racy”) sexual endeavors proliferate in listings in Craigslist’s famous “Casual Encounters” category, which is a key draw of the site.

Just last week, Newsday reported that “5 arrested on Long Island for sex ads on Craigslist”:

Five people arrested this week on prostitution charges had advertised their services on Internet ads posted on Craigslist.com…Nassau County Police Capt. Steven Skrynecki said the ads were promoting sex at motels in Plainview and Jericho. He said the ads walked a fine line between promoting prostitution and legitimate advertising. He said police routinely check the Internet advertising site for illegal activity being promoted in the county.

At the same time, Craigslist “Casual Encounters” New York listings include notices such as (these are the mild ones):

• Sexy lady for chat - m4w – 49
• married man for summer fun - m4w - 35
• LETS PLAY IN MY CAR - m4w - 40

Given that the Craigslist listings are as open, and as uncontrolled, as MySpace profiles, many lucrative corporate recruitment, real estate and automotive accounts are unlikely to choose to participate in the Craigslist community.

The Wall Street Journal weekend report on Craigslist’s June 15 introduction of certain real estate fees in Craigslist New York City, however, puts forth the standard, facile argument that:

The free online-classifieds site has become the nightmare of newspaper executives everywhere it launches a list…Craigslist's obstinate insistence on giving away what newspapers have made their bread and butter has gotten the company a lot of media attention. Many newspaper executives see something sinister in Craigslist's near-total lack of avariciousness -- Are those guys communists? Do they hate newspapers? These critics would prefer to see Craigslist try to make an honest buck off the ads its users post. If the company charged something, after all, it might be possible to compete with them on price. But it's hard to compete with free when you have reporters to pay and printing presses to run.

However, it is not for Craig Newmark, Jim Buckmaster, or any member of the Craigslist community, to worry about “feelings” within the newspaper industry, or about the future of the newspaper industry. Rather, it is the challenge for newspaper executives to develop products that provide better classifieds solutions.

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