January 22, 2005

The Not-So-Pretty EBay Penny

Out of pocket a penny? The market will take a pound of flesh:

EBay, one of the world's largest e-commerce companies, also came in one penny under Wall Street's expectations for the fourth quarter, with a profit of $205.4 million, or 30 cents a share. That compares with $142.5 million (21 cents) in the same period of 2003. -- EBay Shares Plunge
In this case it was about $19 billion worth of flesh as the pump-and-dump specialists on Wall Street dumped off that much in market capitalization. Reasons were many and excuses more if you listened to the word and the rumors coming out of the online giant, but it may well be that, at last, the endlessly complicated EBay home page has hit the limit of what buyers and sellers can comprehend.

Oh, yes, raising prices up to 50% on all your customers doesn't help matters either.

[Matin Tobias has the gruesome details of this fleecing at Deep Green Crystals: E-Bay drops a bombshell!]

This is the kind of monopolistic move that sets both buyers and sellers against you, but then it has been many a year since EBay management cared about that, hasn't it? Whitman's EBay has always been, like the CEO herself, as ethically sketchy as the unbundled software it sells. No reason to straighten out now. Unless, of course, an awakened Justice Department decides to get all Microsoft on them. [Right. Sure. And the latest of Porcine aviation is? -- Ed.]

If you don't believe it, ask yourself how unclued a company has to be to help cheat the Girl Scouts. [HT/ Om Malik]

Posted by Vanderleun at January 22, 2005 10:35 AM
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"It is impossible to speak in such a way that you cannot be misunderstood." -- Karl Popper N.B.: Comments are moderated and may not appear immediately. Comments that exceed the obscenity or stupidity limits will be either edited or expunged.

As an ebay seller since 98, I can tell you that "almost 50%" seriously distorts the actual fee increase. No matter what the item sells for, the maximum aggregate fee hike on an auction item is a whopping 35 cents (although it should be pointed out that the services whose fees are rising are completely optional). On gross sales of $400-600 a month, I'll be paying an additional 80 cents TOTAL, which works out to a total fee increase of two percent - not fifty. Any seller who can't handle paying an extra buck or two a month in OPTIONAL fees has more fundamental business problems than what he's paying ebay.

Posted by: hcq at January 23, 2005 6:12 AM

That's not what it looks like on the link that runs down the increases across the board. Not what it looks like at all.

Posted by: Van der Leun at January 23, 2005 8:11 AM