Newspapers Had to Choose: Embrace Free Local Ads or Go Out of Business, They Chose the Latter

By Michael Carney , written on July 19, 2012

From The News Desk

In one of the most brutally honest PandoMonthly fireside chats to date, Zynga CEO Mark Pincus has laid out each of his entrepreneurial missteps and has done the same with those of others.

His most biting criticism came in reflection of why early hyper-local social network Tribe failed. Pincus says, “I made a lot of mistakes with Tribe. One of the things was that I overestimated how fast social networking would become a pervasive normal for everybody -- and I wanted to jump to the next generation. I wanted to do Craigslist with more pictures and trust."

Tribe aimed to have people finding roommates, jobs, and apartments. Unfortunately, this model depended on the buy-in of the newspapers.

“It was a mistake to partner with newspaper companies. I thought that newspaper companies wouldn’t have any other option than to go with free listings, but it turns out that their other option was to go out of business. They chose ‘B’.”


More than anything it seems that the timing of Tribe was wrong, more so than was its premise. Nearly a decade later, Facebook picked up in many ways where Tribe left off -- in building a trust based online community.

Unfortunately for consumers, Craigslist is still the winner in local listings. As a result, direct or otherwise, the precipitous decline of print newspapers is nearly complete. Looking back, it seems that they should have chosen option A.

[The video livestream of tonight’s event is available here]