eBay after the bell 9-20-06: Two more threats

Product liability laws are clear; EBay liability is moat and is almost impossible to prove otherwise.

Amazon is a single channel e-commerce entity as long as it was opened.
EBay is a multi channel; the difference is stores can auction products in a completive pricing channeled platforms.

These are TWO very different business models unique in their domain.
I do not believe to review the cost analysis of the offering by Amazon as a solution to merchants currently dissatisfied of EBay and as a means of competitive edge over other e-commerce businesses.

http://www.associatedcontent.com/article/64610/ebay_targeted_for_counterfeits_is_this.html

Some very good points here.

1)Try opening an account with Ebid claiming you are from a different country than you really are. It doesn't work as Ebid cross reference IP addresses.

2)Look at the efforts Ebay are making to entice Far East listers. Where do a large proportion of the world's 'knock offs' originate from?

3)Try building up your feedback rating on Ebid via 1c Ebooks. You can't because Ebid do not allow it.

The ebay sites are riddled with frauds, fakes and scammers. They're easy enough to spot. In half an hour this morning I found over 200 scam listings but as to fakes, there are many many thousands and they are just as obvious as the scams.
No sooner are they taken down than they're back on the site again.
Take a look at this one
http://search.ebay.co.uk/_W0QQsassZoneconstructorQQhtZ-1
It's a powerseller's account that has been hijacked.
DO NOT CLICK THE LINK IN THE LISTING it leads to a spoof sign in page.

I have just posted these comments on a related article:
http://www.associatedcontent.com/article/64610/ebay_targeted_for_counterfeits_is_this.html?

It strikes me that eBay may not be too keen to remove the fake goods from their site... They certainly seem very reluctant to act on reports. I have this sinking suspicion that this might well be related to the sordid topic of coin. IE - eBay coining it in from these fraudulent listings? As I understand it, every listing on their site generates associated insertion fees - and every sale generates final value fees based on a percentage of the end value. I may be wide of the mark, but I don't think so. I suggest eBay are generating revenue for themselves by profitting from crime. This is especially valid considering the fact that each listing that is cancelled has the associated fees refunded to the seller.

I don't usually agree that site owners should be held responsible for what their users post, but in this case I'm hoping eBay gets nailed hard. Why? Because for years now eBay users have been begging the management to implement some type of changes or policy to crack down on counterfeit, fake, knock off and reproduction items. Ebay's response? Community. eBay rely's on the Gestapo effect and their users turning in each other's listings. Only if a listing is reported will it be removed, and a reported item isn't always ended. Seems to be quite arbitrary.

For years, these knock-offs have been hurting honest eBay sellers, and they have done nothing about it. It will be interesting to see what happens from this suit.

Ann,

Ebay may be a moat but the water is rising fast. I'd also double check on the law; it is different in Europe to the US. Why are so many French firms pursuing lawsuits?

Ebay is a multi-channel entity; you can buy fake watches, CDs, DVD, fashion items, etc. Hell, you can even get Chinese sellers in Ebay forums promoting their websites that sell knocked off gear:

http://i6.photobucket.com/albums/y232/splash2220/general/sophia1.gif

www.yangyang168.com in case anyone missed it.

Everybody knows Ebay are in dire straits at the moment and their competitors are starting to wake up.

Amazon's webStore appears to be their equivalent of eBay's proStore, with a key difference.

WebStore inventory will appear in amazon search results. ProStore inventory does not appear in eBay search results.

If I was selling online, I'd want as many eyeballs as I could get looking at my stuff.

Ahemm,

Due diligence ... Good faith ... Public access ... Negligence.

I can't wait to see the court transcripts.

Gary

Many are becoming fed up with Ebay's excuse of 'we're just a venue'. Why is it that Ebay can afford to police their forums, as well sue other companies for using the word 'it', yet they let their own site turn to mush? It has also been mentioned that Ebay have heavily courted the potentially lucrative Far East market. This has been a disasterous move. By doing this they have: a) alienated their Western customers b) ensured their site is swamped by more fakes than ever. c) been outmarketed by Alibaba anyway. Ebay have not only shot themselves in the foot; they've blown both their legs off!

Regarding Amazon, finally a company has recognised the potential for 'stores'. The Auctionbytes survey revealed that over 50% of Ebay sellers were going to move to other venues. Amazon have capitalised on this, and it will be intersting to see what develops.
Another plus with Amazon is its efficiency. When you list an item for sale with Amazon, it only takes a couple of minutes. With Ebay, you have to fiddle about with different settings, options and hope that the bug-ridden Turbo-Lister doesn't crash. Many Ebay sellers have moved or intend to move to other sites, but the problem is taking the buyers with them. This will not be a problem with Amazon; the buyers are plentiful there.

To add: Judging by this report, it would seem that Ebay Express comes off worse against Amazon too:

http://auctionbytes.com/cab/abn/y06/m09/i21/s01

I think Ebay will lose in court in regard to the fakes because they are getting a final value fee cut of the illegal fake item and not just a listing fee. Then they get another cut when the buyer pays for the fake item with paypal. This means they are actively participating in the sale of illegal goods. Sellers will have to have proof of authenticity with receit and serial code in the future that will have to be cleared for sale before being listed in certain brand names.

I am not suprised that Louis Vuitton have decided to tackle the Fakes on eBay, the thing that suprises me is that it has taken so long. I understnd that the French Government have been involved in this but were unable to broker a deal. This indicates that there must be some serious pressure in the background, all of which bodes ill for eBay. Brian White said earlier today that eBay may as shut down, as it could not afford to police the site. I would disagree, yes there will be some big financial implictions at first, but it is neccessary pain to ensure the sites long term survival.

Basic verification procedures for users needs to be set up and multiple ID's removed. It is far to easy for someone to set up an account with totally fictitious data, build some 1p e-book feedback, and then set up scams, frauds and fakes. They say it is impossible to prevent these, well if the much maligned group who call themselves CORE can find and report stuff, much of which does not get removed, then surely eBay can find it just as easily. They can find critical comments in their Forums with amazing speed, perhaps they should devote their time to real issues, which would avoid the criticism.

The foolish attempt to increase revenue by massive fee hikes, seems to have been the trigger for people to start looking seriously at the problems within eBay, and regretably are finding far too many, which must be worrying news as both buyers and investors lose confidence. Instead of wasting money on ill thought adventures like Skype, and fighting this case, they would be better advised to invest in sorting out the problems.

I quote: "This week Dior Couture and Louis Vuitton (two brands owned by LVMH) filed a $47 million lawsuit against eBay, claiming the auction giant does not do enough to combat the sale of counterfeit goods on its site. The $47 million is coverage for total damages of fraudulent items sold from 2001 to 2005. The company claims that in the second quarter of 2006, there were 450,000 listings for Vuitton handbags and Dior items. Of the total, LVMH says that 90 percent of the items were fakes."

Surprised? Yes I was too. Only 90% were fakes apparently.