New York Times: It's All Craigslist's Fault
The New York Times just ran with a story about Craig Newmark — founder of Craigslist — making a $20 million endowment to the City University of New York. The Times leads with:
Craig Newmark, the Craigslist entrepreneur who arguably forced the newspaper industry to change its business model after his website put a dent in the lucrative classified ads business, is giving $20 million to the CUNY Graduate School of Journalism.
“In this time, when trustworthy news is under attack, somebody has to stand up,” Mr. Newmark said. “And the way you stand up these days is by putting your money where your mouth is, and that’s what I’ve done.”
As a result of the $20 million gift, which was announced on Monday, the school will change its name this summer to the Craig Newmark Graduate School of Journalism at the City University of New York. The donation, to be made through Craig Newmark Philanthropies, will fund an endowment for the school, which was founded in 2006.
Now, maybe it's just me, but I get the impression that the Times' writer (and probably the whole New York Times) is not comfortable with Mr. Newmark, and certainly not with having a journalism school named after him.
According to a 2012 study by Robert Seamans, an associate professor at New York University’s Stern School of Business, and Feng Zhu, an associate professor at Harvard Business School, Craigslist forced the newspaper industry to change its business model.
“Based on the research we did, there’s no question that Craigslist’s entry had a big effect on the newspaper industry,” Mr. Seamans said. ....
Mr. Seamans and Mr. Zhu found that newspapers lost about $5 billion in classifieds revenue to Craigslist from 2000 to 2007. ....
When asked if his desire to give millions of dollars to the journalism school had sprung from a sense of guilt, Mr. Newmark said no.
Emphasis mine, of course.
What's worse, I suspect, is that Newmark made the $20 million he's giving to CUNY with Craigslist.
(Okay, go ahead, insert the joke about there being no journalism involved at the Times either. Just go ahead, I'll wait. ... Okay, got it out of your system now?)
What's more is Craigslist undercut the whole classified ad business by making most of their ads free. It's like the old joke: "We lose money on every sale! How do we do it? Volume!"