TELECOM Digest OnLine - Sorted: EBay Sees no Near-term Price Rise on Auction Sales

EBay Sees no Near-term Price Rise on Auction Sales

Jim Finkle, Reuters (
Sat, 16 Jun 2007 10:54:21 -0500

By Jim Finkle

EBay Inc. plans no near-term rate increases for online auction
sellers, Bill Cobb, president of its North American business, told the
company's annual sales conference on Thursday.

A year ago at the same conference, the online auction leader raised
fees to list items on stores within eBay's site. Those fee increases
had varied, depending on the final sales price of items. The changes
took effect in August 2006.

"There will be no increase in selling fees this July," Cobb told the
crowd of roughly 4,000 of its "power-sellers" who attended the opening
night of "eBay Live" in Boston.

An eBay spokesman said Cobb was committing to no new fee increases
over the next few months, seeking to reassure the crowd that "what
happened last year ... wasn't going to happen this year."

Several power-sellers in the audience said they remained skeptical
more fee increases would not arrive sooner or later. "We battle
constant fee increases," said Milvy Carrasco, director of customer
service for eBay store Auction Inn.

"It makes it more and more difficult for power sellers to sell on
eBay," said Carrasco of Lancaster, Pennsylvania. She said such
increases drive her company to do more business on other e-commerce
sites, including Inc.

Power-sellers, many of whom make their living from eBay, are worried
that Yahoo Inc.'s recent move to shut down a far smaller auction site
will give eBay more pricing power.

EBay's core auction business has been undergoing constant changes in
the past several years as the world's largest online auctioneer seeks
to retain its stable of high-volume sellers, who are becoming more
sophisticated about sales alternatives.

In April, eBay Chief Executive Meg Whitman signaled to Wall Street
analysts that the company may be gun-shy about contemplating further
fee increases over the next two years.

"As we think about fees, as you know, we typically do something once a
year. January would be sort of the time that we would do something,
and we have not made any decisions at this juncture," Whitman said on
a quarterly conference call.

"But I would not be putting fee increases necessarily into your model
for 2008 and 2009," she told analysts, referring to the spreadsheet
models they use to predict future results.

Rather than boosting price, she said eBay aimed to make money by
driving increased volumes and average selling prices.

Ahead of speeches by top executives, the all-ages crowd was
entertained by a folk group dressed up as hippies singing a variant of
the 1960s anthem of "Age of Aquarius." Lyrics were changed to "Sell on
eBay and pay with Pay with PayPal and call on Skype," referring to the
three pillars of eBay's business.

(Additional reporting by Eric Auchard in San Francisco)

Copyright 2007 Reuters Limited.

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