eBay's progress towards larger selling leaves eBay Live 2008 quite dead.
We often here how some eBay sellers are vulnerable to being dependent on the site for most of their income and this episode highlights that many internet marketers have also found themselves left high and dry by a sudden and unexpected termination of their affilate account. There is a lesson to be learned here for all would be entrepreneurs that goes well beyond eBay. Reliance on a single relationship is a VERY risky business strategy.
If you are upset about the policy changes and are leaving eBay, I commend you. While we try to figure out a way to survive all of the attacks from above, I offer you, my dear readers, a look into eBay's own problems. I ask you to take special notice of the last one listed, and remember it when you pay your monthly eBay invoice.
(courtesy wikipedia)
Other eBay controversies
Other notable controversies involving eBay include:
In May 2000, eBay seller Kenneth Walton auctioned an oil painting on eBay for $135,805, due to speculation that it might be the work of California modernist Richard Diebenkorn. Walton pretended to know nothing about art and claimed to be surprised by the price the painting fetched, and the auction attracted international media attention. In several investigative reports by The New York Times, it was revealed that Walton was in fact an experienced eBay art dealer with several unhappy customers, and that he had colluded with two other eBay sellers to bid up each other's auctions. The Times described this as a "shill bidding ring". Walton and his cohorts were banned from eBay and subsequently pleaded guilty to fraud after a threat by the federal government of the first ever prosecution for shill bidding on eBay.
On May 28, 2003, a U.S. District Court jury found eBay guilty of willful patent infringement and ordered the company to pay $35 million in damages. The plaintiff was MercExchange, which had accused eBay in 2000 of infringing on three patents (one of which is used in eBay's "Buy It Now" feature for fixed-price sales, 30 percent of eBay's business and growing). The decision was appealed to the U.S. Court of Appeals for the Federal Circuit (CAFC). The CAFC affirmed the judgment of willful infringement, and reversed the lower court and granted a permanent injunction. eBay appealed the permanent injunction to the U.S. Supreme Court, which on May 15, 2006 found an injunction is not required nor automatic in this or any patent case where guilt has been established. The case was sent back to the Virginia district court for consideration of the injunction and a trial on another MercExchange patent the inventor claims covers the remaining 70 percent of eBay's business model (see eBay Inc. v. MercExchange, L.L.C. ). This case has been particularly controversial since the patents involved are considered to be business method patents (see Software patent debate).
On July 28, 2003, eBay and its subsidiary PayPal agreed to pay a $10 million fine to settle allegations that they aided illegal offshore and online gambling. According to the settlement, between mid-2000 and November 2002, PayPal transmitted money in violation of various U.S. federal and state online gambling laws. eBay's announcement of its acquisition of PayPal in early July said that PayPal would begin the process of exiting this market, and was already doing so when the ruling occurred. These offenses occurred prior to eBay's purchase of PayPal.
In late 2006, eBay effected a policy change which showed less information about bidders once auctions reached a certain value. This policy has been criticized for making shill bidding much harder to detect, to the potential disadvantage of buyers and significant advantage to unethical sellers who may artificially inflate the price of an auction. An investigation by The Sunday Times in January 2007 uncovered substantial evidence of shill bidding on eBay.
April 2007 lawsuit in California over monopoly practices.
An August 2007 class-action lawsuit in which attorney John Fabry stated, "eBay has been deceiving millions of consumers over the years by claiming their auctions start when submitted, when in reality they do not begin for at least several hours, and up to 24 hours. However, the clock starts running on your selected auction time even though eBay hasn't posted it yet."
On January 29, 2008, a series of new policy changes were announced including an increase in the final value fee and a decrease in the listing fee (when averaged out, the fees actually cost sellers more). Among the more controversial moves was the announcement that sellers would soon only be able to leave positive feedback for buyers, and would no longer have the ability to provide negative or neutral ratings regardless of the experience. The policies also give greater benefits to higher volume sellers. eBay now explicitly gives higher volume "Powersellers" a 5% to 15% discount on the final value fees. These sellers can also receive better terms on shipping costs and preferential positioning in search results.
On February 18, 2008, sellers and buyers who felt the new fees and feedback structure were unfair commenced a one-week strike against eBay.
In April 2008, eBay announced it was suing Craigslist to "safeguard its four-year financial investment". eBay claimed that in January 2008, Craigslist executives took actions that "unfairly diluted eBay's economic interest by more than 10%". In response, Craigslist filed a countersuit against eBay in May 2008 "to remedy the substantial and ongoing harm to fair competition" that Craigslist claims is constituted by eBay's actions as Craigslist shareholders.
In July 2008, eBay started letting web retailer Buy.com list millions of items for sale on eBay without having to pay the listing fees required of other sellers.
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