Craigslist and Carnegie

Alan Rusbridger, editor of the Guardian was handing out the honours this week at the annual Workworld media awards run by the Work Foundation. The gathering was held at the London Picadilly headquarters of BAFTA (The British Academy of Film and Television Arts).

He showed a few slides beforehand, highlighting the predicament of newspapers. One of the slides featured a picture of Renzo Piano's New York Times Tower, now under construction on 42nd street, New York. When finished the tower will provide office space for 10,000 employees.

The next slide featured the unassuming San Franciso house (pictured here) that Craig Newmark and his 22 employees use to produce Craigslist, the internet advertising phenomenon that Rusbridger fears is "sucking the life out of newspapers" with its free access and free advertising deal for most advertisers.

Craigslist's revenue is drawn from paid for job advertisements in various cities and apartment listings in New York. If you look at the advertising rates (the top rate is $75) and note that the site gets 500,000 new jobs advertised every month, the revenue model begins to make sense.

Everything about Craigslist (apart from the HQ and the number of employees) is big. It gets more than 5 bn page views a month, 10m unique visitors and places more than 10m new classified ads each month.

As Rusbridger pointed out, Piano's crystal tower is "old economy". So is Rusbridger's salary: base pay up 14.7 per cent from £272,000 to £312,000 a year as Private Eye was kind enough to remind us this week. I assume his £175,000 bonus awarded on top of that figure recognises that the declining newspaper circulation might have been much steeper without his efforts.

I have been unable to find a salary figure for Craig Newmark (here is his picture gallery instead), founder of Craiglist, but, since it is a not for profit venture, I doubt that it will be anything like the $210m that Home Depot paid its unsuccessful former chief executive, Bob Nardelli, simply to go away.

Jim Buckmaster, the chief executive of Craigslist, has bemused New York analysts by telling them that the aim of the venture is not to maximise profits but to perform a service. Newmark himself does not seem to be switched on by thoughts of cash mountains. He says in this Wired magazine interview that the only thing he lacks is a private parking space.

This is described as "new economy" thinking today but it's not all new. Traditional old economy entrepreneurs wanted to make money, sure enough, but what got them out of bed each day was the desire to make a product or service ever better.

That should still be the aim of the "stewards" who look after public companies today. Instead too many of them spend most of their waking hours talking to analysts, journalists and investors as they concentrate on the ever more feverish activity of buying and selling companies while feathering their individual nests.

What remains unclear to me, is whether the new economy idealists will continue true to their vision of democratic open-sourced, accessible, enterprise or whether they will sell out to the multi-car owning, multi-home-owning, private-jet, luxury yacht lifestyle of almost every other status-building materialist on the planet.

I don't include Bill Gates in that roll-call. Whatever you may think about Gates' Puget Sound home, he has committed himself to philanthropic and charitable ventures in the spirit of Andrew Carnegie, the 19th century steel baron whose own ideal of capitalist responsibility was outlined in an essay on wealth, popularly described as his "Gospel of Wealth" in the North American Review. Making your money is one thing. Spending it wisely and judiciously is no less difficult.