A few hours ago I mentioned that a friend from Google had tipped me to a new Pew study showing how big a hole Craigslist (and similar services) had blown in the classified-ad portion of newspaper revenue. I signed off by saying that the distinction -- Google's not killing the news business, Craigslist is! -- was "worth bearing in mind for precision in blame-casting."

My friend, who was up in the middle of the night in California, immediately wrote back to say that I'd misunderstood the point. With his stipulation that he is speaking for himself and not the company, and with my clarification that he is not one of the household names at Google who by definition are always speaking for the company, here is his note:

It's not at all about blame-casting. It's about proper diagnosis for treatment and recovery. If papers are critically ill from classified revenue woes (Craigslist, eBay, informal email, ...) but they falsely self-diagnose as being sick from over exposure in Google News, then they'll end up closing their borders by withdrawing from news aggregation sites at Google, Yahoo, MSN, and elsewhere. That won't hurt Internet companies [like Google] at all, but it will leave publishers with fewer new visitors, less online monetization opportunities, and still obliviously infected with disappearing classified revenues. They will get sick faster, and journalism as democracy's conscience will weaken. That will hurt every other company, every citizen, and nearly every country. 

The only blame belongs to the publishers. Craigslist, like all startups, was originally funded with pennies on the dollar compared with what media empires spend. It still is! Craigslist has not been bought/co-opted/copied by any of the major publishers even though doing so would have been a natural idea. Readers are moving online but publishers act as though they will go there only if dragged rather than racing to their only life saving destination. News is valuable, but you can no longer get it in printed form as it is hours old by the time you get your paper -- CNN and online news sites had it hours ago! Analysis is worth waiting for, but that is what magazines like The Atlantic are all about. Newspapers will never be about selling your old BBQ again. Ads at random, scattered between unrelated stories, are not part of the future of shopping. 

These are the issues for papers to agonize about; to wring their hands about; and maybe even to beg money to solve. Unfortunately, they've been copying the ideas and technologies invented and introduced by William Randolph Hearst for so long that they forgot his example of how to innovate for the modern day. Hearst, were he living as a 'Rupert Murdoch' of today, would own Craigslist by now, would have an industrywide micropayment system, would have recruited legions of readers as hyper-local bloggers, and otherwise employed the tools and resources of our day to advance his cause just as he brought cartoons, drawings, and later photographs and color to his readers in his.

Extra thought on my end: if this is what someone not in the writing biz can crank out at 4:40am his time, while up with eye problems and a splitting headache, maybe the publishing industry has even more to worry about from web-based competition than we thought!