eBay (NASDAQ: EBAY) is opening a free classified website, not unlike the services offered by Craigslist. The site, called Kijiji has been available overseas. It will now be set up to operate in 220 cities and all 50 states in the U.S. according to The Wall Street Journal. The auction company is vague about how the property will eventually make money.
The new classified site is not good news for newspaper companies like The New York Times (NYSE: NYT) and Journal Register (NYSE: JRC). Shares in these firms have already dropped by as much as half over the last two years as advertising has moved from print to the internet. The availability of auto, real estate, and job classifieds online has been particularly damaging. Most sites like Realtor.com and Monster (NASDAQ: MNST) charge for their services.
The presence of a large, free classified website may pull dollars from some paid online sites, but the companies that cannot afford any more attrition are the ones that still have to support a large editorial staff and printing operations.
Douglas A. McIntyre is a partner at 24/7 Wall St.
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Reader Comments (Page 1 of 1)
7-04-2007 @ 3:57PM
Thomas Jowers said...
mega-bids.com is an online auction site with memabers that has had free GLOBAL classifieds since 2005, what ebay is doing is nothing new, mega-bids has already figured out how to monetize the site, hopefully ebay will soon too
7-05-2007 @ 10:51AM
Gary E. Sattler said...
I fail to see how this move fits into eBay's overall big picture. I find very little logic in it.
Unless of course their intent IS to injure the newspapers.
Maybe we should think about why they'd want to do that?
7-05-2007 @ 9:45AM
firemeg said...
http://tinyurl.com/yoykl7
If this site is successful, it could end up hurting eBay quite dramatically. If eBay tries to monetize the site by charging for posting of ads, will the sellers who left eBay for Kijiji (supposing it is successful and they do in the first place) go back to eBay?