Are Australia’s newsagencies
about to bite the hand that feeds them? In an interesting subversion of
the media process, newsagent and blogger Mark Fletcher has created an online classified business, Findit, and he’s roping newsagencies around the country into the venture.

A
large part of newspapers’ revenue comes from classified ads and in
turn, a large part of newsagencies’ revenue comes from newspapers –
making the new venture a “very uncomfortable” situation, admits
Fletcher. But the reality is that newspapers are “busy chasing revenue
online” and that’s already cutting newsagencies out of the financial
loop.

In the US, online classified Craigslist has already snaffled much of newspapers’ traditional market, says ad consultant Peter Zollman in CBS News.
“Publishers are, and should be, scared witless,” he says. “Classifieds
globally is a $100 billion a year business. A hundred billion dollars a
year, and every nickel of it is in play.”

News Corp’s $US1
billion-plus splurge on MySpace and IGN and Fairfax’s $A625 million for
Trade Me demonstrate just how seriously old media takes the threat from
new media. And it’s only logical that newsagencies will also have to
get entrepreneurial to survive.

But how do newspapers feel about this intrusion on their territory? Nigel Henham, Communications Director at The Age,
doesn’t seem concerned. There are “numerous new internet sites that
start up every week to try and attract classified ads. There are also
plenty of free sites.” The advantage that newspapers have over
pure-play online sites, says Henham, is the “strength of trusted,
well-known brands” which not only have a large audience in print but
are major players online as well.

In contrast, start-up online
classified businesses “rely on spending a very large amount of money on
marketing to attract people to their sites”, says Henham. And as for
Craigslist, one might argue that although it did not spend marketing
money “it had early mover advantage”.

So will people place classified ads at
newsagencies? “I doubt it”, says Henham. “You’d be talking tiny
numbers.” Advertisers can already “simply phone our contact centre and
place an ad online and in print, reaching a huge audience”. And
newsagents “will benefit because they will continue to attract hundreds
of thousands of people to their agencies who want the latest news and
the most comprehensive advertising listings from well-known, trusted
sources”.

But Fletcher thinks his project has a
winning edge. One of Findit’s big lures will be three free social media
offerings. Social Media is the current “big thing” online, says
Fletcher. “One only has to look at the traffic generated by youtube.com
(six months old) compared to, say, The New York Times (150+
years old). Youtube.com attracts three times the traffic. This is one
example of the important of social media in any online play.”

Let the battle of the media generations continue.