All of this whining from the newspapers about how their classifieds revenue is getting decimated begs the question why didn't they build in the very features that makes alternative classifieds offerings so appealing? The laundry list of innovations that make classifieds interesting again, such as messaging, maps, and localized search, are largely available to any newspaper that cares to invest in them. Newspapers are in trouble in the classifieds business not because they have new competitors, but rather because the newspapers failed to invest in this part of the business to offer more value to their customers.
Schumpeter declared that creative destruction was an essential fact of capitalism, that as new methods of production and new products were introduced the old models of economic structure would be destroyed to enable new models.
UPDATE: Here's another whine-fest from the SF WeAkly on the subject.
UPDATE2: here's a post by the guy that ran SFGate's web operations on the organizational issues around newspapers doing online classifieds. via instapundit
Link: Gulp: Microsoft Latest to Develop Online Classified Plan.
Such Web-based classifieds are proving to be tough competitors for the ads that traditionally provided a big chunk of newspaper revenue.
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