Google Launches Free Classifieds

In a move that potentially threatens online classified providers like eBay and Craigslist, Google Wednesday announced the release of Google Base, a service that allows users to post free classified listings.

"Google Base enables content owners to easily make their information searchable online. Anyone, from large companies to website owners and individuals, can use it to submit their content in the form of data items," Bindu Reddy, a Google product manager, wrote on the company blog.

The service isn't limited to classified listings. Rather, it allows users to post any sort of information--recipes, course curricula, people profiles, reference articles, and reviews are all mentioned on the company blog as possible database entries.

But Google Base likely will have the biggest impact on classified listings, said industry experts. "It certainly is a shot right at those guys," said Jupiter Research Analyst Gary Stein, referring to online classified services like eBay and Craigslist. He added that some users might want to post information just for the sake of sharing it, but that for most users, "the primary reason you'll want to put it up there is to sell it."

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Piper Jaffray analyst Safa Rashtchy predicted that most people trying to sell items on Google Base will be small, local merchants--the Craigslist crowd, rather than the eBay retailers. "Craigslist was a great idea because it allowed people to find things locally, and it succeeded because it was a very simple platform to use," he said. "What Craigslist doesn't have--and will be its limitation--is a robust search capability," he said, adding that it's difficult to find information in Craigslist sites for large cities like New York and San Francisco.

But search is what Google does, Rashtchy said, and that will help it compete. "That's really where Google Base comes in," he said. "With much more sophisticated search, it can pinpoint the product you want."

Plus, if Google goes into the classifieds business, it could easily bundle the sale of AdWords--the company's essential source of revenue--to the listings. "That's the one killer thing that could happen," said Stein. "Put a little box on the bottom and say 'would you like to bid on an AdWord?' ... That's an interesting play they could make, and they would open up a new potential source for advertisers on AdWords."

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