As you probably already know by now from the countless write ups on the Internet and from my post in PART ONE of this series, Paypal/Ebay are trying to force what many people are calling a negative landmark decision on all site users in Australia to use Paypal and NO other forms of payment including the exclusion of an already existing merchant account. This decision is to take affect in mid June. Because of this, sellers on Ebay are leaving. And not just a few. Ebay/Paypal’s old tactics of throwing out the baby with the bath water are in full swing once again. Only this time they think that they can throw out the entire bathtub without anyone noticing, including the ACCC (Australian Competition and Consumer Commission.) It is so laughable that Ebay/Paypal think that they can convincingly promote the idea that just because each have an alliance with the other, that this can stop fraud on the site thus making it safer. Being that Paypal is owned by Ebay, to a degree they would be right, but nowhere near to the extent that they say. And the negative unrest that would be created by such a decision from coming to pass, would be what many would call the worst move in Ebay history! Combined with the recent feedback changes and manipulative search results, this places an umbrella of control over the Ebay users that becomes very questionable. My question is, once after they get all this control and power, who exactly will be policing Ebay/Paypal, may I ask? A partnership such as this coupled with the well documented poor service that Ebay/Paypal are known for, is down right scary! It is in fact dangerous, especially for sellers that are trying to make a living on the site.

Selling the idea that Paypal is the safest form of payment is ridiculous because it is absolutely NOT the ONLY safe form of payment option that there is on the Internet. Talk about putting all your proverbial “eggs in one basket.” Taking away all options for using any other forms of payment allows a clear monopoly for Paypal to do as they wish at any time they like and the users on Ebay will have nothing to do about. Coupled with Ebay, this amplifies market manipulation when it comes to fees, customer service and more. And promoting this move in the name of safety may be great for buyers, but Ebay continues to allow buyers to get away with disregarding a seller’s policy guidelines creating a much less than safe environment for sellers. Forcing everyone to use Paypal gives the Ebay/Paypal empire the power to now charge a seller THREE times for one transaction including Listing fees, Sales fees and Paypal fees. And what really gets me is that they try to push the idea that Paypal is safer than a merchant account. WHAT?! You’ve got to be kidding! You mean a merchant account that is supported by major credit cards that are backed by REAL banks and not some Paypal Piggy Bank with strings attached where they hold your money for weeks or months on end just because of the types of items that you sell? And I would much rather have a support department that you can actually talk to in real time on the spot whenever there is a problem as opposed to slow, if any, email communication with form letter responses and employees that are kept in the shadows with the inability to truly correct or advise solutions on a problem. Please!

With regard to the support department that Paypal/Ebay supplies, if a seller has a problem with a buyer, they will never speak to someone in person to straighten it out from start to finish. Everyone knows the Ebay/Paypal way. Once a problem gets to be serious enough to affect your account, emails are the way they’ll want it. Delays for the responses that you get and almost always in a way that gives you that smart-ass politeness. Have a nice day! …while your drowning in problems that threaten your business and livelihood. I have personally seen email communications many times with sellers trying to get answers to issues that never get resolved because of poor customer service. I have witnessed FIRST hand, with what little phone support they do give as telephone conversations with Ebay’s service department were mysteriously disconnected, and not just once or twice, in the middle of trying to get a resolution to a problem while speaking with an Ebay service representative. Do you think that a Paypal only World will enhance the service and support that one would expect to get once Ebay/Paypal have cornered the market for the only payment type to use on their site? Where would the incentive come from exactly to improve on customer service when there are no more Worlds left to conquer?

Compare that type of support to owning your own merchant account… They understand the seriousness of your business. And while you may not always have the transaction go the way you want it, you at the very least get to talk to a REAL person on an actual telephone! EVERY-TIME! One that either knows how or gives you the tools you need to SOLVE a problem quickly. That alone in my opinion is worth the money that you’d pay for owning your own merchant account. In fact, there are several different departments that supply various types of information to inform you of the way things are handled. You get an education in the process to show you how to improve what you’re doing first hand without the need for emails. Try getting that from Ebay/Paypal support. They have too much to handle as it is now and are making things even more complicated for the users with all these new changes. And with these new changes, polices are being intertwined and cross connected. Ebay tries to promote less confusion on the site and then they send out service department employees ill-equipped causing them to be confused themselves. You’d need a week just to read and if your lucky, fully understand the War & Peace version of Ebay’s Terms of Service Agreement. The way things are now, it would seem impossible for the service department staff to be individually assigned to case situations. If your problem goes beyond a single email, good luck because you will wind up reading between the lines of form letters from a random assortment of employees that in many cases miss the mark for responding to the original question being asked. Seriously, I could spend this entire article on just word for word responses from the Ebay service department proving just how poor the support that they supply really is. It is at times literally pathetic! 

For those sellers that think Paypal is the only safe way that payments can be handled for on line transactions, listen to what Im going to tell you… If you are in the market to sell products online, even if you’re only just starting out, you can get a merchant account for as little as $40 a month!! It’s not like it used to be with exorbitant costs anymore. Rates can be as low as 2.19% plus a 25 cents per transaction fee with FULL telephone support and absolutely NO need for email communication whatsoever! Go on line and do inquiries and you’ll find out. Compare that to the cost of owning a Paypal account with difficult support if any. Ebay/Paypal KNOWS this!! They would prefer a seller to remain stupid to these ideas. Forcing all sellers to take Paypal exclusively would keep them that way. What they’re doing by brainwashing everyone into thinking that Paypal is the only viable and safe option for making online payments, is just not right. If under the new Paypal Only policy, the seller owns a merchant account, he/she will need to pay for LISTING FEES, SALES FEES, MERCHANT ACCOUNT FEES and PAYPAL FEES. There’s just no need for that! At the very least, if a seller has a merchant account, they should be allowed to use it! And NOT through a Paypal account. Let’s face it, it’s the only viable and safe way for EBAY/PAYPAL, not for it’s users.

Remember, Ebay & Paypal are ONE company. Forcing everyone to use Paypal in affect double bills the users. And I love the way they promote Paypal by saying that 90 percent of all users on Ebay use Paypal. NO KIDDING!! I wonder if by advertising Paypal as the only form of payment service available on the Ebay site while simultaneously banning or downplaying other forms of payment services such as bank deposits and money orders has anything to do with that! Ya think?!! Everywhere you look on the Ebay site, that’s all you see! Paypal, Paypal, Paypal. Why do you think companies spend millions of dollars on advertising? Because it works!

Anyone remember Bidpay? That was a GREAT company, especially when CyberSource took it over acquiring it for 1.8 million. I remember speaking personally with representatives of that company and the excitement that everyone had with all the new improvements. But, while Ebay allowed Bidpay to be used as a form of payment acceptance on their site, do you ever remember seeing one ounce of promotion for it? Of course not! Then, in Bidpay’s height of power under the new rule, the CEO’s of the company decided that this was not the direction that they wanted to go in anymore. So with NO warning whatsoever, they ceased operations and closed shop. I know for a fact that the employees of the Bidpay company were absolutely stunned! I do understand that CyberSource acquired a company called that already addressed the needs of small merchants, making BidPay’s off-eBay service redundant and, likely, inconsequential. Nonetheless and call me paranoid, but when a company is showing growth and promise on all levels in the middle of an upswing picking up new users at a record pace and then suddenly ceases to exist with no contingency plan for it’s reported over four million registered account holders, that is suspicious to me. Im not suggesting anything, only making an observation. 😉 By the way, what was wrong with the Google owned “Google Checkout” payment service prior to it’s being banned from use on Ebay within only a week from it’s inception to consumers?

Many people don’t realize not too distant ancient history when Paypal was a company unto itself unowned by anyone else. They were a thorn in Ebay’s side when Ebay was offering only Billpoint as the Ebay online form of payment trying to muscle their way into the online payments market then! Billpoint wasn’t working out to well with Paypal as it’s competition. So rather then try to beat it’s competition, Ebay cut a deal to BUY Paypal. Bingo! Problem solved. The details of this fact along with many other fine points, make VERY interesting reading and are clearly brought to light with what by now should be quite an alliance of people that have formed what is currently a class action lawsuit against Ebay/Paypal in the US. You can view information about that lawsuit at the following link… But my point here is that any time a payment service has popped up that comes close to giving Ebay’s payment service a competitive threat, Ebay seems to either ban or buy it OR it mysteriously disappears. Coincidence? You tell me.

Let the sellers and the buyers make their own choice. All Ebay should be doing is to stand behind that choice or not. Promote Paypal all you like, which they obviously do now. If Paypal is such a no-brainer, then Ebay/Paypal should have nothing to worry about. This way it gives buyers a choice, guaranteeing them more than just one safe payment option to chose from while giving the sellers the opportunity to run their business the way they see fit. More payment options means more sales opportunities. Sellers can make the choice of the best way to keep fees to a minimum allowing them to charge less for the items they sell. Technically, there is nothing wrong with a money order or even cash for that matter, it has all to do with the trustworthiness of the trading partners. But I can understand that there is a need for a safe environment with the less than honest players out there. I just feel that this reasoning is going beyond the extreme to make Ebay/Paypal more revenue and not so much in the name of safety and fraud prevention. You would almost believe their reasoning if they weren’t being so damn greedy about it. Aside from creating unfathomable wealth for the Ebay owned Paypal company, they get the other convenient fringe benefit of being able to charge sellers in more ways that you can imagine, increasing fees at will anytime they like.

I hope the ACCC will help the Ebay users in Australia and in turn, the rest of the World by preventing the forced Paypal act from coming to be. Can you imagine though, if this happened in the US?! Oh, wait a minute! Did I just say IF?! …NEWS FLASH!! …How aware is everyone that according to the “Safer Payment Options” under Ebay’s FAQ for rewards and standards, that ALL new users on Ebay in the US are now REQUIRED to use Paypal or own a merchant account making these the only two payment options available for sellers to use? So why are we not hearing the complaints? Because NEW users don’t stand to loose anything by the simple fact that they have no lengthy term investment in a business on Ebay that they rely on financially. If a new user doesn’t agree to accept the use of Paypal or cannot for whatever reason open a merchant account, then they simply are not allowed to sign up enabling them to use Ebay. Further added is that all existing users with a feedback of under 100 are REQUIRED to use Paypal or open a merchant account. THIS is where the complaints are just beginning and is evident in forums on Ebay and all around the Internet. Good sellers are leaving because of it. And now here’s where it gets really interesting in my opinion and you’ll remember me mentioning above about how polices are now being intertwined with one another… ANY user that has more than a 5% dissatisfaction rating within a 30 day period of time, according to Ebay’s FEEDBACK policies, will be REQUIRED to use Paypal or open a merchant account. If a merchant account is not an option for a seller, this is a convenient way for the feedback policy to now act as a weapon against existing users on the site FORCING them to make the choice of using Paypal! If you happen to have a bad luck month, low sales and maybe one or two negatives, even if they are unjustified, the very real threat would exist of you being placed into this position. This is what I like to call “greasing the gears.” Ebay/Paypal have every intention on forcing the entire World to use ONLY Paypal on it’s site, or so it would seem. And by forcing new users to accept Paypal, they falsely build their case to the reason for it’s exclusivity by pointing out it’s high percentage of acceptance.

The serious complaints will come when Ebay/Paypal try making Paypal mandatory to ALL EXISTING users in the US. THEN, you will see a much renewed push to the lawsuit mentioned above. According to the details of that lawsuit, The Sherman Act makes it a crime to monopolize any part of interstate commerce. An unlawful monopoly exists when only one firm provides a product or service, and it has become the only supplier not because its product or service is superior to others, but by suppressing competition with anticompetitive conduct. The terms of The Sherman Act are available to read at the following link… If the government gets enough complaints from consumers with regard to this activity, then they will act. So, if you have a complaint, visit the following government webpage and scroll to the bottom for contact numbers to voice your opinion….

Ebay/Paypal KNOWS that what they are doing by forcing Paypal is not right for many honest sellers, but it’s plain to see that this move forcing all sellers to use Paypal creating additional fee increases will ultimate hurt the buyers just as much. First, by promoting options for sellers such as “Paypal Required” in order to make a purchase, they are in fact shoving Paypal down the buyer’s throats as well. That is unnecessarily placing restrictions on buyers that may not want to use that option. Second, by forcing a seller to incur Paypal fees and then having the convenience of a law that justifies an Ebay policy that does not allow the seller to verbally charge a buyer for the use of any type of payment service, does it in a way that forces the seller to conceal these costs to a buyer somehow. Ebay will tell you that you must incorporate fees such as Paypal into the cost of the item. What a beautifully convenient way to more or less say, it’s your problem, not ours. The fees keep increasing and they expect that the small seller will just be able to afford it by taking less profit. Who do you think is going to pay the fees for the use of Paypal? The seller? Think again. All costs will be passed on to the buyer which in turn will cause less bidding & buying or at the very least, increase the cost of products ultimately making those products unaffordable. Either way, it will wind up promoting a negative buying experience forcing buyers to pay more than they should. Sellers already have regular increases in shipping costs forcing buyers to comply with the economic conditions that exist now! Handling costs will also surely begin to increase as well with the increased price of fuel and materials. My guess is that negative feedbacks & bad DSR ratings will be on the rise for shipping & handling costs because of all this. Ebay will not defend the seller on a shipping/handling costs complaint. They use it in the DSR ratings as the fourth category for a seller because they feel that if the buyer has a complaint with regard to these costs by a seller, they should have the right to complain about it. That maybe true in some cases but what they don’t realize is by continually hitting the seller’s with added fees, it will force sellers to raise something! If it’s not the shipping/handling costs, it will be the cost of the item. Either way, it hurts the buyer and either way, it will be the cause for fewer sales on the site which will in turn hurt the seller and the marketplace. Many sellers are already on the edge with the costs of running their business, that’s why they’re leaving now! That along with one of the ideas that America was built on that Ebay/Paypal wants to take away. Freedom of choice!

According to Ebay, they are only a venue and don’t get involved with the transactions. However, forcing everyone to use Paypal on the Ebay site when that service is owned by Ebay, is now in fact telling a user what to do and how to do it. You’re going to try and tell me that this is not interfering with the transaction that takes place between a buyer and a seller with all the rules and regulations that are attached to dealing with owning a Paypal account? Ebay will have no choice but to get involved with transactions now. If they don’t, then even bigger problems will exist with seller complaints then ever before if they allow negative comments that break seller policy guidelines to stay on seller’s feedback ratings. Just a venue? Not if you’re going to start removing negative feedbacks, your not. They’ve actually created a catch 22 for themselves now. Just a venue, huh? Then how do you explain the employee like atmosphere that they created by using criteria from a seller’s shipping cost to manipulate that seller’s item visibility in a search? Buyers come to ebay for the items that the SELLER posts, not the items that EBAY post. If you want to be just a venue, then start acting like it by allow all sellers equal opportunity for the items they sell since after all, ebay is PAID by sellers for a service. The second you start to regulate that service based on the simple fact that one seller’s overhead costs more than another, you cannot claim to be just a venue anymore! Especially when every Ebay user is paying the same price for the service they receive on the site. It would be different if the policies being implemented didn’t have flaws, but they are severely flawed and allowing unfairness to go on like this, you start building a case of prejudicial treatment. You’ve got honest sellers out there that are seriously struggling to make a living and then Ebay screws them because they cannot afford to offer free shipping which according to Ebay will now be one of the ways to get more search visibility. That’s BULL!! Or maybe a small seller cannot afford to hire a workforce causing him to ship only once a week or even the United States Postal Service delays a shipment because there was a flood not allowing the truck to get to it’s destination or a storm grounding the aircraft from taking off to get the packages delivered in a timely manner. So because the buyer didn’t get the item within what THEY would deem to be a reasonable period of time, unaware of any pending condition that may have existed having nothing to do with being the fault of the seller, they are allowed to leave a bad DSR or negative because of it? Again, that is just BULL and certainly not the result of a site calling itself just a venue!

No question, Ebay sales are down. Information is coming in from sellers on Ebay with sales reports on the last few months since the policy changes have taken affect and the results are not good. Sales are dropping like stones. It’s no surprise that Ebay stock has followed suit down consistently 10% from last month to this. I do understand that you’ve got a terrible economy right now, and actually, how convenient for that, which is another thing. Beautiful timing I’d say. It was fairly easy to predict with all the unrest and the upcoming change in the Presidency that the economy wasn’t going to get better anytime soon. What a great opportunity to mask the possible negative result of such unstable policy decisions. Yes, Ebay sales are down, the economy stinks, there’s the culprit. No, no, not so fast. I don’t completely agree with that. With oil reaching record levels, bargain shopping on line now should look a hell of a lot better than making the trip to a shopping mall in a car with the air conditioner on eating even more gas. And with that into consideration, look at Ebay stock down 12% from last year to this. On the other hand, one of Ebay’s rivals,’s stock has increased 11% over that same period of time. Still think it’s the economy?

Donahoe, Ebay’s new CEO, thinks very highly of himself. He has that luxury. He wouldn’t know what it’s like to be driving around in a 1985 Chevy and living in a 3 room apartment with two kids to support using Ebay as a means to make ends meet with these new restrictive policy changes. His biggest concern seems to be more in the way of where that next million he’s trying to make is going to come from. He is of the opinion that what’s good for the buyer, is good for the seller and Ebay. I read that somewhere. But this is clearly the opinion of someone that doesn’t understand that the buyer is not the one with the day to day responsibilities of running their business. The seller has much more to worry about than most buyer’s will ever realize. Donahoe thinks he’s getting rid of less than honest sellers. He just doesn’t get it. But he will, after it’s too late. Eventually, the honest sellers he’s dumping will build up one of these other venues enough to finally cut into Ebay’s turf and then he’ll wonder how it happened. He’ll get rid of more than he bargained for and maybe even pick up a costly fight in the process with all the questionable policies and activity.

But I would love to see the Regional VP of Ebay or someone like him come to a meeting in the US and get away with comparing not using Paypal to allowing people to buy heroine on the streets like Simon Smith did in a recent town meeting in Australia. What do you think his chances of getting out of that room alive would be? Can you see the mentality here though? This is a person that has been elevated to a VP position using a term like that on the very people that pay his salary. Unbelievable. It makes you further think of the people at the helm in what it is that they think is important if that is the best that they can come up with for an analogy. This also very clearly demonstrates the preparedness of the agenda in front of a public forum that which can easily be compared to the way Ebay/Paypal irons out the impact of important policy decisions such as this before they are carried out.
As for the feedback changes that have been made thus far, the DSR system is flawed. The report statistics that they have are nice and all, but this doesn’t take away from the fact that you are basing a sellers item visibility on the presumption that the buyer is telling the truth while simultaneously presuming that the seller is dishonest until proven innocent. The problem there is that with the DSRs, the seller never gets to voice their side of the story! If the buyer overlooks a seller’s policy guidelines and is pissed off because of whatever inconvenience that it created for them after the transaction became binding, the DSR system will be the perfect way to screw a seller without him or her having the resources to report the offense simply because they won’t know who screwed them to begin with! As Ive stated in the past, if the seller’s policy guidelines are within Ebay policy, there is no excuse for a buyer overlooking, misreading or ignoring these guidelines. But yet, if they do and are not happy with the result because of their OWN actions, the buyer can still voice their opinion in such a way that protects their identity so a seller has NO WAY of defending themselves. And those DSRs will hurt the seller’s item visibility on the Ebay site. Is there anyone out there thinks this is a fair way for a seller to be treated? Honestly?

There are things being done to calculate DSRs and negatives on a seller’s account that are not clear anymore. With the way feedback was before, a seller could see EXACTLY where he stood. You knew just how Ebay calculated the result of a feedback percentage. That is not possible anymore. For example, how do I know for sure that DSRs and Negatives are not counted more than once on a seller’s rating when received by a single buyer for the same transaction? By creating DSRs, you give Ebay even more power and control and have no choice but to assume that the calculations are being done fairly. I would feel better if I knew that history proved Ebay was mistake free, but they’re not. And questionable practices concerns me even further for the ease with which dishonestly could come into play. When the very nature of the DSRs are to keep the buyer protected, how does a seller know if Ebay is not making a mistake? That’s like making a deposit into your checking account and not being able to see the result of that deposit on a statement. Think that’s a bad analogy? I don’t. Not when the result of the DSR’s and feedback has the capability of ruining my business. 

Then you’ve got this deal with the neutrals. Neutrals now being counted as negatives towards a seller’s rating are definitely not a good thing. But that is precisely what Ebay has now further imposed on sellers. Not only is it not a good thing, but it breaks contractual obligations that Ebay has with it’s buyers and sellers for something that was over and done with to now have a serious affect on the present and future status of a seller’s feedback rating. Or at least for the first year of the new policy term until the negative comments and stars drop off the 12 month chart. There is nothing in the Ebay Terms of Service agreement that would allow the status of what was clearly defined in the past as a neutral feedback, to now have a negative effect on a seller’s account going forward. Ebay also overrides the intentions of feedback having been left by a buyer with this change. Changing all neutrals to negatives is directly tampering with the buyer’s intent of what they meant to say. With the clear Ebay policy description of what Positives, Neutrals and Negatives mean, buyer’s made specific decisions for leaving a NEUTRAL, NOT a negative and NOT a positive. And at the time a buyer left a feedback rating, had this new policy been in place to make a buyer aware that by leaving a neutral, they would in fact be leaving a negative, they may just as easily have left a positive instead. Standing by the idea that a neutral still means that the buyer was unhappy with the transaction, thus in actuality a negative experience for the buyer, is lame. Yet, that is what Ebay’s stance is on this subject. What the hell is the point of a neutral, can anyone tell me this?! Again, Ebay bases their decisions on a much smaller group of people’s opinions and then takes the easy way out by using a calculator to determine the outcome for everyone handing out punishment accordingly. Still think Ebay is just a venue?

And the idea that the sellers have no way to rate a buyer at all is also a concern. What exactly would be the incentive for a seller to give a refund to a buyer or even leave a positive feedback if there is no way to have the negative comment for whatever it is that the buyer is complaining about withdrawn even after the seller did everything right to correct a problem? This to me is just another policy move that was not thought out thoroughly enough before it’s implementation.

And finally, there is a case to be made for the way Ebay has not removed negative feedbacks in the past given by buyers that complain about sellers that do not use the Paypal service. If with the new feedback changes, Ebay continues to refuse requests for removing negative complaints such as this when after a seller has clearly stated that they do not accept Paypal, then this would be just another way to indirectly force the use of Paypal on a seller unjustifiably. As the policies in the US stand now, the seller has the right to refuse the use of Paypal. Let’s see with the new feedback policy in place if Ebay removes a negative on a complaint from a buyer with regard to a seller that’s policy guidelines states that he doesn’t accept it.

In PART ONE of this series, I focused on the forcing of Paypal. In PART TWO of this series, I focused on the issues with the new feedback system. If you can find the time, please feel free to read those posts. It is without question, that these two issues are the biggest concerns for Ebay’s users today. Two issues that I feel Ebay has the great need to improve on quickly and that are ultimately having a direct connection with each other in such a way that herds the buyers and sellers just like cattle to do what they want them to do. But we all know what happens when there’s no more grass for the cattle to eat.

So to quickly recap, Ebay/Paypal are going to force you to use their payment service, shutting out all others including ones that are just as safe or even more so. They will be using feedback ratings to a degree of having control over a seller’s visibility on the site even though all users are paying the same price. It has been very clear from the past that they will not support the seller’s policy guidelines by removing negatives or bad DSRs, but yet will now be limiting a seller’s income capability on the site for negatives and bad DSRs from buyers that ignore, disregard or overlook those same policy guidelines. And finally, with a Paypal only World in place, they will be given the power to increase fees across the board at will leaving users that cannot afford these fees no other option but to leave the site. That alone has the very real potential of ruining people’s businesses and livelihoods. Simply put, all this is just way too much power for one company to have over not only it’s users but the marketplace in general.

But yet, we mustn’t forget, Ebay is just a venue. 😉


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