The Myth Behind Craigslist: It's Not Maximizing Revenue Potential

from the bull dept

We pointed this out a few years back, but there's this persistent myth behind Craigslist that reporters love to repeat, and it's just not true. The latest is that it shows up in an otherwise excellent profile of Craigslist by Gary Wolf in the latest Wired Magazine. The whole article really is worth reading, though Craig plays up the whole Forrest Gump of the internet schtick a bit more than is fair. However, the article again quotes CEO Jim Buckmaster supposedly brushing off concerns about maximizing revenue:

"Companies looking to maximize revenue need to throw as many revenue-generating opportunities at users as they will tolerate."

But Buckmaster's very next claim belies the fact that he knows the first half isn't really true:

"We have absolutely no interest in doing that, which I think has been instrumental to the success of craigslist."

And, that, really is the point. While it may seem paradoxical, Craigslist actually is being much smarter (on purpose or not) in how it "maximizes profits." It's doing it by not pissing off users and not trying to squeeze them for every possible penny today, knowing correctly that doing so is a horrible long-term strategy. But it's difficult to think of many companies that throw off the sort of profits that Craigslist does on a regular basis. It employs 30 people and most estimates suggest in brings in $100 million in revenue per year. What other companies of that size bring in that much in revenue?

Then look at all the companies that claim they are trying to maximize profits. And compare. I can't see how anyone can take the claim that Craigslist isn't doing that with a straight face. The company knows more about maximizing revenue than probably every celebrity CEO or management consultant out there.

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Craigslist Forced To Cough Up Name Of Oscars Ticket Seller To The Movie Industry

from the but-why? dept

Apparently, the Motion Picture Academy, the folks who put on the Oscars (also known as "The Academy Awards"), say that the tickets to that event are non-transferable. That's fine. It's their event, they can set up whatever rules they want. However, where it gets strange, is that they are now suing a bunch of folks who tried to sell their tickets online, and even got a judge to force Craigslist to reveal the name of a seller in order to sue him.

So, here's my confusion: if the tickets are non-transferable, why not just check IDs at the door and not let those who were not given tickets?

As for forcing Craigslist to reveal the name of the seller, why is that allowed? The Academy can have whatever rules it wants in terms of letting in or not letting in people, but what law was broken by the seller, and what makes it so that Craigslist should be forced to give up the name of an anonymous seller? All the Academy had to do was not let the person in the door, but apparently it chose not to run things that way. But that's the Academy's choice, not a legal issue the requires revealing the name of an anonymous seller.

Furthermore, the Academy's explanation for this also seems ridiculous: "If you don't know who's inside the theater, it's very difficult to provide security." Really? Most places that provide security don't know the names of everyone who's there and they seem to do just fine. And, again, if knowing who's in there is such a big deal, then why not identify them as they enter, and verify that they're supposed to be there? None of that would then involve lawsuits. But, then again, this is the movie industry, which has shown a penchant for lawsuits over actually thinking things through and taking the easier path.

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eBay Sues Craigslist, As Craig And Jim Dilute eBay's Share

from the call-in-customer-service dept

You may recall that eBay was able to buy approximately one quarter of Craigslist back in 2004. The details of what happened were never made entirely clear (and there are some conflicting stories about those details), but it appeared that the two companies co-existed somewhat peacefully for a while, despite eBay's decision to basically create a Craigslist competitor in Kijiji. However, now things are getting more interesting. Apparently, back in January, Craigslist did something to dilute eBay's share, which eBay now feels was illegal. The company has now sued Craigslist over the matter, though most of the details are hidden, as the lawsuit was filed under seal. Given that Kijiji finally expanded into the US last year (just as Craigslist continued to expand internationally), it's no surprise that Craigslist would seek to decrease eBay's stake in the company. Either way, the perhaps already awkward linkage between Craigslist and eBay seems to be getting even more uncomfortable.

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Craigslist Ransacking Was To Cover Up Burglary

from the well-that-didn't-work dept

Remember that story last week about someone posting a fake ad on Craigslist, leading to people ransacking a house and taking all sorts of stuff? It turns out that the folks behind the fake ad were simply trying to cover up their own burglary of the house. Apparently, they had stolen some stuff from the garage and figured the best way to hide the theft was to get a ton of other people to steal stuff as well, via the Craigslist ad. Of course, by posting the ad, they made it that much easier to track them down, as police retrieved the IP address and were able to figure out who was responsible. Once again, despite those who tried to "blame" Craigslist, it looks like Craigslist helped the police catch the crooks.

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Craigslist Blamed Yet Again For Something It Didn't Do

from the just-can't-help-it,-huh? dept

Weren't we just pointing out that everyone seems to want to blame Craigslist for things that it has no responsibility for? The latest is Connecticut's Attorney General, who has attacked Craigslist for allowing ads for prostitution. This is hardly a new charge. Last summer, the mayor of Atlanta lobbed similar charges at Craigslist. But, of course, just like that time, the blame is misplaced. Craigslist is the tool provider, not the content provider. To blame Craigslist isn't just wrong, when it comes to illegal acts like prostitution, it's downright backwards. Why? Because as some police have realized, Craigslist is actually a really useful tool for police to track down and arrest people breaking the law.

So not only is it placing the blame on the wrong party, it's doing so in a way that would only drive the prostitution further underground, making it harder for the police (and the Attorney General's office) to do their job. How smart is that? But it sure does generate headlines... The Attorney General, Richard Blumenthal, had this to say in a letter to Craigslist:

"I am astonished and appalled by Craigslist's refusal to recognize the reality of prostitution on its Web site -- despite advertisements containing graphic photographs and hourly rates, and widespread public reports of prostitutes using the site."

To which I can only reply: I am astonished and appalled by Richard Blumenthal's refusal to recognize the reality of liability and section 230 safe harbors -- despite it being the law of the land and widely known and discussed in legal circles.

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If It's On The Internet... Blame The Service Provider (Especially If It's Craigslist)

from the logical-difficulties dept

There's a jokey saying that people like to spout when they hear stories of people believing the most ridiculous things found on the internet: "If it's on the internet, it must be true." That saying certainly showed up in the story earlier this week about people ransacking and looting a house in Oregon after someone put up a post on Craigslist saying that the house had been abandoned and everything was free for the taking. When the owner came back to the house telling people to stop, they pointed to the Craigslist ad as "proof" that they could continue their looting. Hence, "if it's on the internet, it must be true."

However, in the aftermath of this event (which is actually a copycat from a similar event nearly a year ago), we're seeing a different, but perhaps equally as common, fallacy come out: If it's on the internet, blame the service provider, rather than those actually responsible (okay, it's not quite as pithy). This seems especially true when it comes to Craigslist. Remember, Craigslist has been blamed for discriminatory posts as well as many other illegal things found on the site... including child prostitution. It's not just Craigslist, of course, but for some reason it's extra common with the site. So, it should come as no surprise to already see some asking if Craigslist should be responsible.

I'm trying to figure out why so many people gravitate towards blaming the service provider, rather than whoever was actually responsible for the crime (in this case, the guy who posted the claim as well as the people who stole stuff form the guy). There are three potential thoughts that come to mind. The first is that they go after the service provider because that's easier. Fortunately, the law isn't supposed to attack the easiest target, but who's actually responsible. The second is what I like to call The Steve Dallas defense after an old, old, old Bloom County cartoon where lawyer Steve Dallas explains why he's suing Nikon after Sean Penn beat him up for taking a paparazzi photo. It can be summarized as: just blame whoever has the most money. The third option might really just be a repeat of the first, but it's that people still see the internet as new and confusing, and find that it's too complicated to parse out the nuances of the different roles of different players online. So in trying to parcel out blame, they work backwards to the first recognizable player.

People would never blame the telephone company for an extortion scam using the telephone. And they wouldn't blame Ford for making a getaway car used in a bank heist. Yet, they want to blame Craigslist for one of many postings on the site? If a crime happens on the internet... blame the service provider.

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