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Last Updated: Thursday, 24 July, 2003, 21:13 GMT 22:13 UK
EBay's dot.com success
By Duncan Bartlett
BBC World Service business reporter

eBay
EBay offers millions of items for sale every day
Click onto the EBay auction site and you can bid for an incredible range of goods - everything from stuffed armadillos to real Rolls Royce cars.

In the space of a few years, EBay has become one of the most popular - and profitable - sites on the world wide web.

It was founded in 1995 by Pierre Omidyar, a French Iranian living in the US who wrote its basic software in a weekend.

At first it only appealed to a few computer geeks, but soon the site attracted collectors of antiques and memorabilia.

Early success was swelled by the trading of cuddly toys called Beenie Babies, and the swelling has continued.

"Right now on EBay, at any given moment there are seven million items up for sale," said Adam Cohen, author of a book about EBay, The Perfect Store.

This, he believed, appeals to human nature.

"People have this driving need to acquire goods, and off course to sell goods to make money," he explains.

Cost control

EBay's founder, Pierre Omidyar, and his team were shrewd operators.

Unlike so many dot-com entrepreneurs, they kept their overheads as low as possible.

Profits come from a commission on sales.

Trust

EBay has nurtured a community of users with a vast range of backgrounds, even a South London vicar with a passion for jazz who recently bought a rare John Coltrane album via eBay.

"I got it for a lot less than I would have paid for it in a second-hand shop in London," Reverend Steve Hance said.

The Reverend has bought and sold items on eBay hundreds of times and has an excellent "feedback" rating from the site's other users.

That's important because eBay is a market rather than a shop, so members have to trust each other.

"I have not had very many bad experiences," Reverend Hance said, insisting that the system works rather well.

Global reach

For the Reverend Hance, eBay's just a hobby, but a hundred thousand people make their living from it.

EBay officials insist that retailers gain access to a global market place, while sellers often get far more for their products than they would locally.

In the past few years eBay has invested heavily in its operations outside the United States and now has sites in Korea, China and Mexico.

Its aim is to expand worldwide.

And with profits pouring in, it has got plenty of cash to keep growing.


SEE ALSO:
EBay bets on China's boom
12 Jun 03  |  Business
EBay users hit by sales tax
06 Jun 03  |  Business
eBay fined over patents
28 May 03  |  Business


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