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EBay Abandons Plans For PayPal Monopoly
An anonymous reader writes "eBay's has lost its fight to ban all payment methods except PayPal.
When Paypal originally announced the scheme it was to be global,
but they began with a dry run in Australia to test the reaction of government and consumer authorities.
In the public slanging match that followed between eBay and the regulatory ACCC, eBay spammed users claiming it was fighting for 'safety benefits for consumers.' Fortunately the consumers won.
Conceded eBay vice president Simon Smith, 'While we disagree with the ACCC's draft notice, we have decided to withdraw the notification to stop any further confusion and disruption among the eBay community.'
Nevertheless eBay insists PayPal is now always offered as a payment option.
Have big corporations finally learned that they can go too far? More chillingly, if eBay had launched the scheme in America would they have gotten away with it?"
The outright banning was perhaps a red-herring, i.e. an "It can be worse" program to distract people from other anti-competitive measures they were taking at the same time.
People will remember only that they were considering to ban the competitors outright, they have withdrawn that. Hence, they have succeeded. The public (the news media) will now ignore the more important changes -- the new requirement that paypal be offered on all listings.
Think of the auction bidding strategy that involves conspiracy: the highest bidder will confer with a third party to "accidentally" make an obvious bidding error, like bidding 100000 on a $100 item. The high-bidding conspirator will withdraw their bid (based on it being an obvious error), with the second-highest bidder getting the item for a ridiculously low price.
Banning non-paypal services outright is the distracting (erroneous bid). Making it mandatory to offer a Paypal option on all listings is the lower bid that still gets the item (eBay merchants' payment processing business).
They've also basically gotten away with it by banning their potential biggest competitor (Google) early.
Justifications are only to save face. The real reason they want to ban new non-Paypal services should be obvious.
By having pay-by-PayPal-through-eBay's-site required to be an option for all actions, the other payment methods will begin to be marginalized.
Because they will be less convenient.
By "not banning them" eBay will pretend to be placating them and allowing competition, where in fact, it will be harder for competitors to compete than before.
Now by withdrawing their "ban on alternate payment services", many people have by now forgotten or won't notice other changes...
They'll think eBay learned their lesson and will play nice, when it couldn't be farther from the truth.
Australian law lays between the consumer-driven EU laws and the company driven-US laws.
The ACCC is an independent government body specifically designed to prevent US-style corporate bastardisation. It's significantly resistant to US-style lobbying and has the power to stop company mergers, monitor and investigate pricing, regulate telecommunications companies, make unfair company policies illegal to enforce and works via a complaint system. (Meaning that individuals have the power to enact a government body to look into unreasonable practices.)
The ACCC is the reason why the iPhone is available on all competent Australian telecoms, why banks had to pass on savings to consumers and why ebay couldn't impose their paypal policy.
The smaller nature of the Australian population allows for this kind of organisation to exist, so I'm not confident this would scale without corruption to larger countries.(There is also an organisation which deals specifically with corruption.)
As with any system, there is an appeals process, many companies don't take this route (such as ebay) as the ACCC are usually just enforcing the existing fair trading & trade practices laws.
EBay is a medium to connect buyers and sellers, nothing more.
That's the mantra eBay has often chanted (usually in the context of somebody wanting to hold them responsible for some fraud that has been perpetrated), but the fact is that they have gradually done everything they can over the years to insert themselves between buyer and seller, and to be directly involved in every phase of the transaction. They have already previously tried to ban or at least discourage other forms of payment -- this is nothing new. They tried several years ago to force all sellers to complete transactions through eBay's own "Checkout" system, and only backed down after mass bitching by some very high volume sellers. They try to intimidate you into using only eBay's own on-site message system to contact bidders instead of e-mailing them directly.
The problem with these measures is, while still technically "optional," eBay does nothing to encourage such "rogue" behavior, and many (maybe most) users, both sellers and bidders, who have come aboard after these "options" were implemented are under the impression that they are mandatory because eBay pushes them constantly while burying the more seller-centric options in obscurity. Consequently, many bidders no longer understand the "eBay is only a venue" schtick, and believe that they are dealing directly with eBay. After all, when your messages all come through the eBay site, and you pay by clicking on buttons on the eBay site, you lose track of the fact that there are thousands of individual sellers who are the actual merchants. I've had problems with more than a few bidders who refuse to answer my e-mails or to pay me directly instead of through eBay's Checkout because they think it's not "official" otherwise, and that I am trying to pull some sort of scam on them.
"Every great cause begins as a movement, becomes a business, and eventually degenerates into a racket." -- Eric Hoffer
You do all that to avoid being stolen from, and you still do business with paypal? If your fruit vendor threw a nasty one at you every fifth visit would you just start wearing a raincoat?
If video games influenced behavior the Pac Man generation would be eating pills and running away from their problems.