[it's "illogical" to do good.] April 2, 2006 Business / Your Money: Death by Smiley Face: When Rivals Disdain Profit NYT By RICHARD SIKLOS Ventures that simply want to cover costs - like Craigslist.org - are illogical in commercial terms. But they have the competition scratching their heads.
Full Story: http://select.nytimes.com/mem/tnt.html?emc=tnt&tntget=2006/04/02/business/yourmoney/02frenzy.html&tntemail0=y >There is another breed of rival lurking online for traditional media, and it is perhaps the most vexing yet: call it purpose-driven media, with a shout-out to Rick Warren, the author of "A Purpose-Driven Life," for borrowing his catchphrase. > These are new-media ventures that leave the competition scratching their > heads because they don't really aim to compete in the first place; their > creators are merely taking advantage of the economics of the online medium to > do something that they feel good about. They would certainly like to cover > their costs and maybe make a buck or two, but really, they're not in it for > the money. By purely commercial measures, they are illogical. If your name > were, say, Rupert or Sumner, they would represent the kind of terror that > might keep you up at night: death by smiley face. >Probably the best-known practitioner is Craigslist.org, the online listing site. Although it is routinely described as a competitor with — and the bane of — newspaper classified ads, the site is mostly a free listings service that acts as a community resource. When the company contemplates imposing fees for using its site in a particular city, as it has recently in New York, it does so cautiously and thoughtfully, as a means to weed out real estate brokers who are abusing the site by posting their ads over and over. >The twist about Craigslist and its ilk is that their egalitarianism could make them very valuable someday — although Craigslist's founder, Craig Newmark, has proclaimed no interest in cashing in. EBay, no doubt sensing the commercial potential, bought a 25 percent stake from a former employee last year. Other examples are the "for sale by owner" Web sites that have cropped up across the country, in which people can sell their homes at a cost that is a small fraction of the usual broker's fee. < -- Jim Devine / "There can be no real individual freedom in the presence of economic insecurity." -- Chester Bowles
