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June 04, 2008

Comments

Mike

I think it's a creative idea, but I don't think it makes sense.

What makes Craig's List great is the non-corporate look and feel to it. It's an organic site - one that is trusted precisely because it is not obviously part of a large organization trying to make money. It has also focused on anonymity and registrationless-access - something you can only do if you've got a business model that doesn't require you know who your users are.

Microsoft, on the other hand, needs web properties to augment search and its advertising network. If Microsoft tried to incorporate Craig's list listings into its search, or if Microsoft tried to place advertising on Craig's list, it would radically alter the feel of Craig's list. And of course, a Microsoft or Live logo would be very difficult to pull off.

I'm not saying it would be impossible, but I do think the branding issues between what Microsoft needs and what the Craig's List community needs are radically different. It would be very difficult to meet both needs in a combined entity.

So Microsoft could buy it and fund it, and make $75M/yr in profit off of it. Maybe they could grow it in a white-label way to a $150M/yr business. But that's not going to move the needle for Microsoft.

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