I seriously don't understand the Craigslist drama.
It's an incredibly basic service that is astounding because of its network effect.
So if you want to compete with it, make a BETTER service. Don't rely on them. Adoption isn't going to be instantaneous, but if PadMapper's approach really is so much better than why do they need to bootstrap themselves with Craigslist-affiliated data?
I don't understand the drama either, but everyone knows it isn't that easy. As has been said many times, their network effect is what matters here, not features. I use craigslist and I hate it (seriously, something about the site irks me) but I know I have no choice if I want the best chance of finding something. I used padmapper and loved it; it was a better service.
For a good example of how strong network effects play into things, look at Google+. Seriously, if Google couldn't kill Facebook by building a better service (IMO), how do you expect a company with exactly 0 existing users to usurp CL?
TBH I don't have a good solution because I don't think regulation is the answer here. Up until about today I would have said the best value add for a service is to start by targeting sellers, and grow the buyer market later (e.g. use service X to post ads to CL, <other marketplace>, etc)
> if PadMapper's approach really is so much better than why do they need to bootstrap themselves with Craigslist-affiliated data?
Because as you said: (massive) network effects. The claim is that they are effectively a monopoly. You can't tell someone "Sure it won't be instantaneous, but if you think you're so much better than Standard Oil, just go out-compete them."
Why? Everyone needs to come to the network owner, and it isn't possible for new competitors to create their own useful network. The network effect is really the exact analogy for information-exchange businesses as physical capital was for businesses selling physical goods.
Except that in one sense the network effect is even stronger: oil wells can be divvied up by a trust-busting government (and will still function) but some networks only work reasonably when monolithic. This is an argument for a monopoly administered by the government (like for road infrastructure) or a private non-profit (like wikipedia).
No, in SO's case, their competitors were physically incapable of entering the market (because they couldn't purchase stakes).
With network effects, the barrier to entry is less for competitors to join the market and there is nothing physically forcing a user to use a monopoly. A great competitor has a realistic chance of entering your market. Plus, a slight shift in public perception and a Monopoly can become a failed business in no time.
Network effects may be a significant impediment to a small business attempting to enter a market, but lets not throw around the 'monopoly' label so easily.
SO only had a 64% market share when it was broken up. Competitors weren't prevented from entering the oil market because they were physically incapable of buying oil wells. It was because SO had enough market share to greatly influence prices through unilateral action, and to threaten business partners with crippling retaliation for dealing with SO competitors.
I would guess CL has, in most classified markets, more than 80% market share. The amount of market share necessary for monopoly powers varies between industries (based, presumably, on the barriers to entry), but I don't think I'm being casual with the term "monopoly". Especially considering the power of network effects.
Is it not obvious that CL can only get away with its crappy UI because it has overwhelming market share? The fact that it is immune from normal competitive pressures is the defining feature.
No its not obvious because I don't have a problem with their UI. Most CL users don't. They have a clean UI that doesn't overwhelm you. Posting is dead simple.
Anyway, at this point, neither of us will convince the other. So... good day to you.
Much as it would be less hypocritical of CL to share, which would seem to align with their publicly stated values, they won't.
The key is to disrupt innovatively. CL's structure sets a high bar, but not an impossible one. PM is one of the first alternatives that looks plausible in a major portion of CL's space (though there are also some job boards that seem pretty viable, several of which also re-list CL postings).
Edit: By DeMenthon's own comments, CL offered a data-sharing agreement for $5000 + 10% of revenues. Really, that's reasonable on CL's part.
I understand what you mean, but network effects aren't unsurmountable. I'd argue that social networks are the pinnacle of services sustained by a network effect, but there's still fluidity (MySpace was a pretty terrible platform sustained by a strong network -- until it wasn't.)
It's an incredibly basic service that is astounding because of its network effect.
So if you want to compete with it, make a BETTER service. Don't rely on them. Adoption isn't going to be instantaneous, but if PadMapper's approach really is so much better than why do they need to bootstrap themselves with Craigslist-affiliated data?