eBay Fee Hike news roundup for Friday 18 August: stock analysts cheer...

[mandy]

...but they've been wrong before.

EBay Inc. is about to find out whether a fee increase will help the company reverse a strategic error and boost revenue - or drive away some of its highest-volume sellers...

Next Tuesday, it will increase pressure on high-volume sellers to switch. Under the new fee structure, a $50 item sold through the store will generate $4.46 in fees for eBay, up from $3.27 before the change.

That's going to narrow the gap considerably between how much it costs to list an auction item versus a store item. Under the old rules, store items cost 27% less to list than auction items, according to calculations done by Bear Stearns analyst Robert Peck.

As of Aug. 22, however, the difference will be just 3%...

full article: http://www.marketwatch.com/News/Story/St...1A98D86%7D&source=blq%2Fyhoo&dist=yhoo&siteid=yhoo

As much as eBay sellers complain about the new rate changes, in the end I think that they will all still be on the site, selling the same goods that they currently are through their online stores. They will just have to go back to doing business the old fashioned way. Robert Peck, an analyst with Bear Stearns said in a note to his clients that "Sellers, while they may not like paying more for the same service, usually choose to do what is most economic to them - and in this case, the volume of dollars generated from eBay is usually too significant to walk away from."

Time will tell if this rate change will put the company (whose stock price has fallen around 40% this year) back on track, but for the time being Wall Street seems to be taking a favorable view on the recent developments...

full article: http://www.bloggingstocks.com/2006/08/17...-for-ebay/

[iConcepts]

At one point earlier this year, some 83% of all the listings on eBay's U.S. site came from stores. Yet they only accounted for 9% of all sales, which resulted in slower growth than either eBay or Wall Street expected.

EBay has already moved to correct the situation. For example, in January it began to no longer includes unlimited listings from its stores in the results displayed when users search the eBay site.

Braindead analyst fails to draw any possible connection between the reduced visibility of the the store listings and the lower conversion rates. There's the pump....wait a few months for the dump.

Bob