There's been some press lately on new services that are focused on using blogs for classified listings. One of these products is Edgeio, which according to a recent BusinessWeek online blog

The way Edgeio works is that bloggers would post items they want to sell right on their blogs, tagging them with the word "listing" (and eventually other descriptive tags). Then, Edgeio will pluck them as it constantly crawls millions of blogs looking for the "listing" tag and index them on Edgeio.com.

Conceptually, Edgeio sounds complementary to a couple of competing standards for embedding content in a blog...Microformats and Structured Blogging. For a decent overview on these check out Stowe Boyd's entry Microformats v Structured Blogging: A Small War Big Consequences.

I find this topic interesting for a couple reasons. For starters, Multiply integrated classified listing templates in a blogging application over two years ago. Perhaps more interesting though is that Multiply recently removed the technology! Why? Because Multiply is about your social network, and by social network I don't mean the fake add-everybody-as-a-contact-whether-you-know-them-or-not networks prevalent elsewhere. We aggressively try to recreate a realistic approximation of people's real-world networks because we use one's network much as an e-mail program uses one's contact list.

As part of that goal, unlike every other networking or media sharing site, we do not provide any system-wide global views. On Flickr, for example, you can see an aggregation of every Flickr users' tags...but you can't see an aggregation of just your contacts' or your social network's tags. Ditto their photos. When you do a profile search on sites like MySpace you are searching the whole multi-million user database. Profile searches on Multiply are limited to people you are legitimately connected to. Likewise, our old "marketplace" only showed listings added by people in your network, not every Multiply user.

But to build a successful market you need two key ingredients. 1) Lots of buyers. 2) Lots of sellers. The more buyers and more sellers the better the market. We could've made our marketplace better by adding an "everyone" view but felt it was more important to be true to what we're about- communicating with a trusted group- not providing exposure to absolute strangers. You can use the rest of the internet for that. So since we recognized that this conflict was preventing us from building the best marketplace, we simply removed some of those features to focus on areas where we can be the best.

I would point out that while Multiply's model didn't make for the best marketplace repository, Multiply was extremely effective as a notification mechanism. Better than e-mail, our proprietary multi-messaging allowed somebody to notify their whole social network that they were selling something...and it still does. People are still selling or requesting "wanted" items via generic posts or blog entries with as much effectiveness as when we had the market template and centralized repository. They can also tag their entries "listing" and look through those items.

So that's Multiply. What about these other technologies and the companies hoping to capitalize on them? I have a few doubts and they all come down to the two ingredients. Buyers and sellers. Let's start with the sellers. Who are they? I'd say the vast majority of people posting items on CraigsList and eBay probably don't have blogs, it will be a while until they do, and assuming they do are they going to be so web2.0 savvy to not just think of posting on their blog, but encoding it properly with whatever tagging mechanism becomes the standard? I believe the only sellers initially are going to be not just the early adopters, but a subset of that group that buys into the concept. Is that enough to sustain the model to the point of critical mass?

Let's make some assumptions and assume that enough people blog listings to support a market. If so, where will the buyers go to? To Edgeio? Why? If encoding blogs takes off it is going to be based on open standards. If there are millions of blog entries properly encoded with "for sale" listings, there will be plenty of Edgeio competitors aggregating those listings and trying to present them uniquely. What is going to make one better than other at this task, which on the surface, doesn't seem like much more than a subset of Feedster or Technorati which are already aggregating blogs?

More importantly though is that one blog-classified aggregator doesn't just have to be better than another, it has to be better than CraigsList or eBay, and there's a huge obvious challenge to that happening. There would be nothing stopping CraigsList from aggregating the blog listings themselves. Items added on CraigsList + blog classifieds will always be greater than just blog classifieds and hence a better marketplace.

The bottom-line is that whether on a site like Feedster or Craigslist, functionality related to shopping blog classifieds will at most be just a piece of a business, and not necessarily a business itself. Of course this is consistent with Web 2.0. If Web 1.0 was about attracting enough audience so you can IPO, then Web 2.0 is about attracting the right audience so you can sell your feature. I'll elaborate more on this in a future post.