01-31-2007, 09:20 AM
Seeking Alpha on eBay's ban of virtual items:
full article: http://internet.seekingalpha.com/article/25605
Quote:The move is short-sighted. eBay's market power stems from the defensibility of its network effect - buyers come to eBay because the sellers are all there in what for eBay is an ongoing virtuous circle. Breaking that circle for a specific category of goods or services is probably not a reversible decision - once a network effect has established itself at a new marketplace within that category the same defensibility that secures eBay's wider business is very likely to prevent eBay clawing back a share of that market segment.
The secondary market for virtual assets was estimated at a value of $900 million in 2005, with forecasts for it to reach $7 billion by 2009. As long ago as 2002 Edward Castronova, an expert in the economies of virtual worlds, posited that Norrath (the Everquest gameworld) had an economy that made it the 77th richest "country" on earth. eBay is turning its back, probably irreversibly, on a vast and growing market...
full article: http://internet.seekingalpha.com/article/25605