With all of the newspaper industry’s huffing and puffing over Google and other news aggregators, you’d hardly suspect that print journalism has another major problem on its hands.
New research (PDF) from the Pew Internet and American Life Project solidifies what I’ve been hearing for a long time: It’s the classifieds, silly.
Over the last four years, use of online classified services such as Craigslist has more than doubled, Pew’s research found. Almost half of Internet users go online for classifieds now, compared to 22 percent in 2005. Every day, 9 percent of Internet users hit up Craigslist and other online classifieds, compared to four percent in 2005.
The cost to newspapers is immense. After reaching peak revenues of $19.5 billion in 2000, classifieds in American newspapers pulled in less than $10 billion last year. In other words, newspapers have lost half their classified revenue in the last eight years, while online classified use has doubled in half that time.
This begs the question of whether there’s any way for newspapers to stop the bleeding. Last month, I read a stirring essay by Jeff Jarvis about how the industry blew its chance to become a major player in the Internet age. Even if newspaper companies could somehow find a way to keep practicing journalism — Jarvis argues that it’s too late for that, even — I’m not sure the same could be said for classifieds. What could a newspaper offer that Craigslist cannot?
Missing from Pew’s research is any explanation for why online classifieds seem to be cannibalizing newspapers’ business, but it’s got to be that deadly mixture of (mostly) free and immediate. Want to get rid of that dresser today? No need to wait for tomorrow’s paper, and no one else will ask for a cut of the sales. Maybe hyperlocal papers could offer robust classifieds in markets too small for Craigslist to cover, but for cities, the opportunity was lost years ago.