Sellers fear online auctions will die after a decision to allow fixed-price marketing by major retailers
David Smith, technology correspondent The Observer, Sunday August 10 2008
Going, going, gone? Furious fans have accused eBay, the website that brought auctions to the internet, of betrayal. They are upset by a decision to lurch away from the website's original format and instead allow major retailers to list thousands of products at fixed prices.
The trend, they warn, marks the beginning of the end for the online auction - leaving eBay looking less like a car-boot sale and more like a shopping mall.
'Auctions in some categories are already pretty much dead,' said Chris Dawson, an eBay seller from Thatcham, Berkshire, who runs a blog about the site. 'Not many people bid for rechargeable batteries, Gillette razor blades, toothbrushes or even mobile phone handsets or DVDs - the kind of commodity items you pick up in a supermarket. EBay started out for the collectors' market but it's been overtaken by the business market. Buyers have become used to instant sales on the internet, and they expect eBay to be no different.'
Randy Smythe, a former eBay seller who now runs an e-commerce blog, said: 'I believe eBay's drive for growth has killed the auction format. They are trying to compete with Amazon and the rest of e-commerce by giving you everything in the same search. "Buy it now" and "fixed price" added growth at first, but they've killed the golden goose.'
The changes have led some small sellers to accuse eBay of betrayal. Growth of the site's worldwide active user base slowed to a relatively modest 1 per cent in the past year. Smythe, speaking from southern California, added: 'Sellers have decided they're not going to eBay any longer. I've seen a lot saying that they're going back to the things they did before eBay - the flea markets, the trade shows. It means those rare items aren't on eBay any more.'
In the 13 years since it was first set up, eBay has become famous. But as it pursues more users, its owners have struck highly profitable deals with a string of major firms. Retailers such as Argos, Littlewoods, Orange and the online shoe shop Schuh now offer thousands of items on eBay at fixed prices. These compete alongside items offered by independent small sellers through auctions which can take days.
Buyers are showing a preference for fixed prices, with the promise of a reputable brand and instant delivery. Fixed-price sales on eBay have grown by 60 per cent over the past six years, eating away at the auction side of the business. They now comprise 43 per cent of the value of all goods sold on the site, up from 39 per cent a year ago. Analysts say that it is only a matter of time before auctions are in the minority.
The shift has enraged eBay's many fans. There was fury in America after eBay signed a partnership with Buy.com, which allows the web retailer to sell millions of books, DVDs, electronic goods and other items on eBay without paying the full listing fees. Buy.com's presence has hurt many smaller sellers which compete in the same categories.
It is one of several changes made by eBay's new chief executive, John Donahoe. A spokesman for the company in the UK said: 'Today fixed price accounts for over 40 per cent of the value of all our sales. We'll continue to innovate to bring parity to selling in fixed price alongside auctions and choice for buyers to shop whichever way they want