eBay Scraps Transaction Fees in China

PlayCleverFully writes "The US online auction service eBay scrapped all sellers' transaction fees in China, in an effort to compete with local competitors offering free services, including Yahoo-invested Alibaba.com. The online auctioneer announced the changes on its China auction website, saying transaction fees would be waived, but small fees would continue to be charged for listing products on the site's webspace and for "feature" products. eBay's China unit, Eachnet, would also require all sellers to provide authorized online payment mechanisms to improve its credit environment, including PayPal and other escrow services, the announcement said. The move means that sellers won't get paid until the buyers receive and are satisfied with the products, it said."

Comments

Moving time!

[DaHat]

Screw all of this talk about moving to Canada or Europe... sounds like China is now the place to live... except for that whole... oppression of unfavorable speech and blocking of websites.

Re:Moving time!

[DaHat]

Head on over to http://blogs.msdn.com/msnsearch/archive/2006/01/20 /515606.aspx to see some info from the horse on what kind of information was requested and given, at least as far as Microsoft search is concrned... it's not as bad as many have claimed.

Re:Moving time!

[CyricZ]

You realize that this could be the first of numerous future requests, right? And there's nothing stopping the future requests from being far more probing.

With the first request they:
CAN see how frequently some query terms occurred.
CANNOT look up an IP and see what they queried
CANNOT look for users who queried for both TERM A and TERM B.

With the second request they:
CAN see how frequently some query terms occurred.
CAN look up an IP and see what they queried
CANNOT look for users who queried for both TERM A and TERM B.

And with the third request they:
CAN see how frequently some query terms occurred.
CAN look up an IP and see what they queried
CAN look for users who queried for both TERM A and TERM B.

At that point censorship and persecution is far too close.

Re:Moving time!

[aichpvee]

Growth is the key to a strong economy. A strong economy without significant growth is not a very healthy economy.

Do you really believe that insane nonsense? Infinite growth in a closed system (ie THE EARTH) is IMPOSSIBLE. It's this kind of thinking that has doomed our economy to an unending cycle of booms and crashes.

Re:Moving time!

[rolfwind]

Growth is the key to a strong economy. A strong economy without significant growth is not a very healthy economy.

I don't know about that, eternal (big) growth is unsustainable if the population of the country levels off or if all the 3rd world countries (cheap labor/new markets) evolve into 1st world countries over time.

I think growth is needed for a strong economy with a lot of debt (US: Government has 8 trillion dollars debt, individuals even more) and you can see this hit Japan even more, as it's population amount is leveling off (some Europeans countries also have low birth rate) and it's loaded with debt.

You are also seeing this in the housing market in the US. The prices are insane right now, and everybody who is buying is betting that growth/prices will increase even further in the near-term future, making the current prices a bit cheaper with inflation/future payoff. That's betting on future growth, but is it there?

But what about an economy with little (government) debt? Does it need much growth?

Re:Moving time!

[operagost]

Being allowed to move millions of people to build a dam or host an Olympics without the consent of the governed does wonders for the GDP!

Re:Moving time!

[Yahweh Doesn't Exist]

in China, the government has the right to move people for national causes.

in America, the government has (unconstitutionally) given the right to businesses to move people if the business will use the land for more profit and taxes.

which is scarier?

The 21st century will belong to China.

[CyricZ]

Indeed, countries like China and India will be where the 21st century will take place.

But in the big picture, it is just the typical East-West reversal. Remember, in centuries past China and India were the major world civilizations. The Europe of today is much like the China of the 1200s. And the China of tomorrow will be much like the Europe of today.

The East was on top for a while, and then various events lead to the West becoming more prosperous. But we see the tide turning one again, this time in favour of the East. In three or four centuries it will no doubt switch back towards the West's favour, and soon enough there'll be yet another switch.

Re:The 21st century will belong to China.

[BuR4N]

" In three or four centuries it will no doubt switch back towards the West's favour.."

It will go much faster, as living standard grows in China much of what are now a benifit for the country will vanish. People will demand more spare time, higher salarys, the country will have to deal with enviromental issues and political issues. Just to name a few.

They are cutting allot of corners today that gives them an temporary advantage over the west.

Re:The 21st century will belong to China.

[LnxAddct]

I've got to disagree, this is not you're typical pendulum swinging anymore. In centuries past, nations were isolated. We live in a global economy now with rapid communication, if the pendulum is swinging, its not swinging much, but rather getting comfy in its final place.

I don't think India and China are going to be where the 21st century happens. Really their only benefit is they have a large population with which to pull work from. With the rapid replacement of manual labor with automated means (something I strongly support and push), sometime around 2030 or so you'll see most manual labor and even a good chunk of work once considered to require intellect replaced with machines. At that point India's and China's greatest strength (their population) will be their biggest burden because it will no longer be the nation with the largest work pool, but rather the nation with the most efficient machines. At this point, it seems that a number of nations could take that title, none being China or India.

China's government, while getting better, I doubt will change enough to support the kind of economy that would ensue from the continued succes that they've had for the past decade or so. India is in a similar situation, but not quite as bad. I do find it ironic however that some of the outsourcing firms in India are no longer using Indian programmers but rather outsourcing their work to Chinese programmers to save more money. It implies a trend of future economic stagnation, there are similar situations in other job sectors of India also. There are a few trends like this that seem to lead to only a short term period of prosperity (most likely not lasting more than 2 decades, maybe 3). Google around a bit and you'll see reports and forecasts predicting similar situations.
Regards,
Steve

Re:The 21st century will belong to China.

[caudron]

Indeed, countries like China and India will be where the 21st century will take place.

Sure it will.

Seriously though. While that link is a bit tongue-in-cheek, the reality is that while it seems logical on the surface to assume that China and India will take the technological lead, reality is likeely to prove counter-intuitive.

It may be non-PC to point this out, but China and India are incredibly backwards countries by Western standards. You think America has problems because some vocal minority wants to rant about evolution? Remind yourself that America spend more money on research than any other country on the planet...bar none...and by a VERY wide margin. Much of that research money gos into military research, which again might suggest to you that we will lose the edge elsewhere, but you should not underestimate the usefulness of military research to the civilian world (the Internet being the most common example) and you should not underestimate the power of a nation whose biggest advances come from the military sector in terms of world power.

It's cool lately to compare America to decaying Rome, but the fact is that the world is a different place than it was during the Roman Empire and our lead is enrenched in a way the Romans could not conceive.

The problem for other countries is essentialy that while they are making advances, we are too and we are starting from a position that all but ensures victory. It is possible but unlikely that anyone could not only overtake us. We aren't a sitting target, regardless of what you may have heard in the media (that sells more papers with prophecies of doom that visions of a bright future).

Sorry, but the best we can all hope for is that America grows into a leader that respects other nations fully and seeks to lift them up rather than knock them down.

The world is not fair. We are in the lead and right or wrong, China and India will have to do A LOT more than they are currently if they hope to compete. As I said, not impossible, just highly improbable.

Re:The 21st century will belong to China.

[theguyfromsaturn]

Ibn Khaldun had a theory, although he used city dwellers and nomads based on his personal experience. The perspective may have been too limiting in terms of the relative "virility" of city dwellers and nomads, but I think the basic premise is not bad and can be generalized:: Those who have lots of wealth, spend more time spending the wealth than creating new wealth. Relatively speaking the poorer people are more productive, becaue they are capable of living with less. In essence we're spoiled brats living off the wealth accumulated by our forebears. Their success is the direct cause of our failure. The eternal dilemma of life.

All the time our customers ask us, How do we make

[Spazntwich]

money doing this? The answer is simple: volume.

That's great

[Anonymous Coward]

because eBay just raised fees for US sellers again.

Re:That's great

[CyricZ]

And, like it or not, the Chinese market dwarfs the American market. Remember, that holds true even today, without the full Chinese market being completely realized and integrated. Once the Chinese market really gets going, coupled with that of India and other Asian nations, traditional markets will look quite irrelevant.

Even with significant wealth, a 300 million body US market is still quite insignificant when compared to the 2 billion person Indian and Chinese markets.

EBay is quite lucky to be able to tap into such fantastic financial resources so early on. If they can maintain a foothold in those markets, they will become extremely prosperous.

Re:That's great

[c_forq]

First all, your data is several years old.

I would like to note that it clearly states 2004, which at maximum 2 years old (and it would have to be from the first 22 days of the year to even be that old).

It's all about a bigger marketplace

[morcheeba]

Yahoo Auctions beat Ebay to the Japanese market by only 5 months, and it has dominated there.

the article is misleading..

[512k]

it's not a %9 increase based of the auction ending price in the US, it's a %9 increase of their current percentage. %2.75 to %3 in this case. Ebay has 3 levels of pricing, %5.something percent for the first $24, %3 for the next 25-999 of value, and around %2 for anything over $1000. The people who make a living bulk importing brand new things from China and re-selling them on ebay are NOT going to be happy about this.

And you can always set your searches to be US only.

Re:All the time our customers ask us, How do we ma

[Spazntwich]

It's actually a quote from SNL, you straight-up clod.

Re:All the time our customers ask us, How do we ma

[CyricZ]

Indeed. And as is often shown, spamming is a very lucrative business. If you can base your business around a large volume sales, even at a few pence per sale, you'll often be very well off.

Where is the online auction competition in NA?

[qualico]

So what eBay is saying is now that we own the North American market, we'll keep raising the fees.

Does anyone know of any other good online auctions?
Maybe its time we start to take our money to the competition so we can get a break like the Chinese.

Re:Where is the online auction competition in NA?

[Vellmont]

Does anyone know of any other good online auctions?


Pretty much they all suck, with Yahoo sucking the least. The problem is really a chicken and egg problem. To attract buyers you need a lot of items available. But to attract sellers you need a lot of buyers. With both those groups settled on ebay to do auctions it's very hard for another auctioneer to get a foothold, even with cheap or free listing fees. I've looked at yahoo auctions before in the hopes I'd get a better deal because of the smaller amount of buyers, but I can almost never find what I'm looking for on yahoo auctions. Because of this I essentially forget that Yahoo even does auctions.

The real competitors to ebay is still people selling things locally and privately. Craigslist is probbably the biggest competitor to ebay because you can get things the same day, there's no fees to anyone, and there's no shipping as it's all designed for a local city.

Re:The eBay longterm strategy for $$$ in China....

[CyricZ]

1. Give away the service
2. ????
3. Take over market share
4. Raise prices again
5. Profit!

So they just need to figure out how to steal the market share and they are good to go.

Step 2 is "Wait while the market works."

Indeed, at this point all they would have to do is outlast their competition. The market itself will likely lead to consumers going with the lowest-cost option. So there are no unknown steps in this plan.

Fortunately for EBay

[ztucker]

In an unrelated move, the Ebay subsidiary PayPal tripled its "seller protection fees" for as yet undisclosed reasons

Ebay's Failure

[Bellum Aeternus]

My time in China showed me that Ebay is failing, not because of competetive pricing, or a poor cost model but because their major competetor is home grown and plays to the Chinese cultural prefrences. Ebay has been hesitant to branch their code base to make Ebay-China more Chinese friendly -- and therefore no cost cutting measure is going to save Ebay in China. Just look at how wonderful Ebay did in Japan. http://news.com.com/2100-1017-845099.html It's the cuture stupids , it's the culture!

Capitalism works well at first

[YearOfTheDragon]

Capitalism works - for the Chinese.

Capitalism must be cared for. You must care that there is enought competition. You must divide monopolies. Capitalism need a lot of work.

It's a system that works, but as any other system, when some people gets too much power the system is corrupted and stops to work.

In China capitalism is making the government to share its power, so it's working great. In U.S.A. the government is concentrating power in itself and in the big companyes, so capitalism works no more.

It isn't only a matter of what system you chose, but of whom is using it and how.

Just my 0.02c

[squoozer]

I'm pretty new to the whole eBay thing (about a month) but I have to say as a new comer I am stunned by the complexity and cost of it. The fees are nothing short of scandalous and the number of things that you have got to get your head round before being able to sell well.... The whole auction thing is dead in most markets as it is dominated by businesses setting start prices which are what they want for an item (erm, I'm guilty of that too but that's not the point). To top it all the site is slow and generally confusing. I'm surprised no one has taken the market away from eBay.

Culture, or Time To Market?

[xenocide2]

Even the article suggests that Ebay lost to Yahoo! because they were late getting to market in Japan. Metcalf's law really applies in ebay style auctioneering. In the absense of software interoperable with ALL auction sites, the largest site will have huge advantages over competitors identical in operations. If bidders have to use the website to find auctions and bid, then they'll gravitate to one or two sites, the ones with the largest selection. The primary function of this is the number of people visiting, so early gains over competitors aren't just important, they're vital. It would appear that marketplaces are one area that gravitate towards a natural monopoly.

Bootleg Central

[mrshowtime]

Ebay has a serious, serious, problem with China and it's "goods" provided/exported. I love how they raise the rates for legitimate US sellers, but ignore the fact that now the Chinese Bootleggers list for FREE, totally screwing anyone selling dvds on ebay. Do a search for the Sopranos on ebay and you'll see what I mean. Ebay is bootleg city and has really done nothing to stem the tide of Chinese bootleggers on ebay. I have seen a LOT of Chinese bootleggers that sell only bootleg dvds that have THOUSANDS of positive feedbacks and are ebay Powersellers and are relatively untouchable. Hopefully ebay will start to take China more seriously and suspend the bootleggers, especially now that they are not making any money for ebay and are effectively tying up the ebay system. Of course, this won't happen, especially with ebay now asking sellers to waive any and all rights and protections if they want to sell on the new ebay express site coming soon.

Re:Bootleg Central

[mochan_s]

Really? That's outrageous.

On an unrelated note, I needed to purcahse a few DVDs. **click click** ebay.com

Let's all of U.S. get Addreses in China

[mrs clear plastic]

What would happen if someone in China opens up a private mailbox service (similar to Mail
Boxes Etc or Postal Annex) and take advantage of the China Ebay and their policy of
weived fees.

If ebay sees that you hava a China address, would they give you the China rates?

If you are a seller, you don't have to worry about having your China address in your
transactions. It's only the buyer who has to have a good shipping address.

Perhaps we here in the U.S. would need to have two ebay accounts. One that we use
to sell (with a China address) and the other we use to buy (with a good U.S. shipping
address.