rogerd - 4:44 pm on Apr 1, 2010 (gmt 0)
Actually, Craigslist can be quite useful. I just sold a baby grand piano via the site. I'm not a regular user, but that experience convinced me that it's viable for selling things in a local market.
Traffic is the key for any auction or classified site. People won't invest the time in creating listings, much less using any paid listings, if the audience is small. Even in the smallish city where I sold the piano, there was plenty of action in the musical instrument and other categories.
The key for eBay will be to really leverage its own reputation and traffic to drive the new classified site. Of course, it might well cannibalize its local auctions if it does that.