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In lugnet.market.auction, Jon Kozan writes:
> They're increasing the listing fees across the board.
> In particular, they're discouraging small auctions by increasing the opening
> bids on lots starting under $10 by 20%, whereas other opening bid listings are
> only increasing 10%.
>
> Here's the message:
> ---------
> "Today, we are announcing two changes to the current eBay price structure.
> Effective Wednesday, January 31, 2001, we are increasing insertion fees and
> adding a charge to the 10-day listing option. Final value fees, other feature
> fees and insertion fees for vehicles, eBay Premier and Real Estate remain
> unchanged.
>
> Insertion Fees
> Here are the old and new price schedules for insertion fees:
>
> Opening Value Current Insertion Fee New Insertion Fee
> or Reserve Price
> $0.01 - $9.99 $0.25 $0.30
> $10.00 - $24.99 $0.50 $0.55
> $25.00 - $49.99 $1.00 $1.10
> $50.00 -$199.99 $2.00 $2.20
> $200 and up $2.00 $3.30
>
> 10-Day Listing Option
>
> A new ten-cent ($0.10) fee will be implemented for the 10-day listing option.
> The three-day, five-day and seven-day auctions will not have an additional • fee.
>
> We recognize that price increases directly impact our sellers. The last time
> insertion fees or final value fees were increased was December 1996. We will
> continue to build a vibrant marketplace by investing heavily in technology,
> marketing and customer support to make it possible for millions of people to
> discover and use eBay."
It's time to short the stock (although the stock is down substancially from
its high of about 128$ in march 2000). Those company have very little fixed
costs and the costs of bandwidth are decreasing. As for advertising, companies
pay them to advertise. If they are introducing a policy like that it's because
they have to answer to some disgruntled shareholders. Also, higher fees mean
less auctions which mean less revenues. I guess they won't have the same growth
as 2000 and they are trying to increase the revenues in a different manner.
Eric.
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