02:04 PM

eBay Raises Seller Fees

On Wednesday, company president Bill Cobb announced across-the-board listing fee increases, and sellers immediately blasted the hikes.

eBay shares climbed Thursday after the giant online auctioneer raised the fees it charges sellers for listing goods on its site.

By mid-day, shares of eBay were up 89 cents, or 2.95%, to $31.06.

On Wednesday, company president Bill Cobb announced across-the-board listing fee increases. Insertion fees will be boosted to 40 cents from 35 cents for items priced between $1 and $9.99, while eBay's take on the final knock-down bid -- what it calls "final value fee" -- will climb to 3.25% from 3% for items that sold at prices between $25.01 and $1,000.

The San Jose, Calif.-based auction site also made several additional adjustments to fees charged by its Motors division, where sellers list cars, trucks, motorcycles, and other vehicles.

All new fees will go into effect Jan. 29.

"While we believe these changes are modest, we consider any changes that may impact our sellers with great care," said Cobb in a statement. "These adjustments are the result of careful analysis, and we believe they're the right thing to do to keep the marketplace strong for our and eBay Motors sellers."

According to a FAQ on the eBay site, the money raised by the new fees will "help us maximize opportunities to make product, marketing, and other investments that will improve the marketplace and help our sellers grow their businesses." The company didn't outright reject any additional fee increases during 2007.

Sellers immediately blasted the boost in fees. On eBay's "Seller Central" forum, a seller identified as "cartgal" said she was ready to wrap it up. "I am getting close to calling it quits. Yes, it's only a nickel (plus the additional sold percentage) but if I only sell one of 5 items listed, that nickel is suddenly a quarter, and those add up."

Others were even less kind. Seller "jmmahoney" wrote on the same thread: "Bill Cobb's 'modest' price increase is 12.5% on the front end [actually 14.2%] and 8.3% on the back end. [The] hikes take advantage of [eBay's] near monopoly position in the online auction market [and] does a great disservice to its loyal sellers."

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