Saturday, 16 December 2006

Skype security problem yes or no?

Skype version 3 network traffic is harder to detect and block than previous versions according to iPoque. iPoque specialise in software which logs, throttles back or blocks undesirable traffic for corporate networks. They have upgraded their software to detect Skype 3

There are two issues with using Skype. First security - opening holes in firewall to allow traffic always carries a risk. Not huge, but it's there. A bigger risk is if users start transferring files or are sent links which they click. Logic says this is no worse than traditional email, you should never accept attachments or click on links if you don't know what they are and who they're from. Security flaws in Skype have been found in the past but it should be noted these are NOT flaws in voice, they required the user to click on a link causing a buffer overflow.

The second issue is one of network management. Sure a network administrator should be concerned with which applications are running on computers and traffic consuming bandwidth. What seems to have been missed is that security doesn't start with blocking traffic at the firewall level! Security should start with barring users from installing unauthorised applications in the first place. All the way back to Windows NT user profiles have been available. User profiles deliver the applications a user needs, and can vary by log on so that different users get different applications tailored to their profile. This means users have the applications they need to carry out their job, but nothing else. Additionally companies should have security policies which are reflected in employee contracts making it a sackable offence to install unauthorised software.

In summary ANY application communicating to the Internet poses a risk - they all open ports (holes) in your firewall. The biggest risk with skype isn't with voice - it's with file transfer and URL's in chat windows. Companies like iPoque are trying to plug holes which, with good network management and security profiles, shouldn't be an issue in the first place.

It should be noted that there is a Business Version of Skype with a Network Managers Guide to deliver versions tailored to a companies specific requirements. Network administrators can configure which parts of Skype users can use including for example blocking chat and restricting the ability to add users to the address book. Users should NOT be installing the standard version, they shouldn't be able to install ANY applications.


Overstock raises $40M in stock placement

Troubled online auction house has announced it has raised US$40 million selling around 2.7 million common shares to institutional investors. The money is needed for working capital, including sales, marketing and inventory purchases.

Stifel Nicolaus analyst Scott Devin saw this as a positive event, saying that the cash injection "gives the company enough capital to attempt to fix the core business." The market appears to agree: Overstock shares rose 46c, around 3%, yesterday.

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Staffs. RM strike confirmed

Christmas deliveries of mail are set to be affected after 800 postal workers in 11 delivery offices in Staffordshire went on strike. Today's action is set to continue on Monday, and the backlog of mail caused at this busiest time will affect deliveries up to Christmas.

The strike is over vacant posts which had previously been full-time being downgraded to part-time. The Communication Workers Union says that proper consultation has not been completed, and that Royal Mail are in contravention of a national agreement with them.

Doug Neel, an RM spokesman, said "My understanding is they are looking at further action on 23 December, which is obviously a difficult day, the last delivery prior to the Christmas holidays - which will have a significant impact on our delivery service."


You couldn't make it up

In a story that even Hollywood screenwriters might find incredible, it seems that the Oscar statue which Karl Malden has thought for the last twenty one years to be the one he won for A Streetcar Named Desire is, in fact, a fake. He only found out when the real one cropped up for sale on eBay.

In 1985, Malden sent his statuette, won in 1952, to its makers, R S Owens and Co. of Chicago, for replating. What he received back, according to David Quinto, his lawyer and spokesman, was a different statuette, stamped with the same serial number as the original.

Some twenty years later, that original was put up for auction on eBay, starting price US$30,000.

"The Oscar is a very personal award," Quinto said. "The Oscar is cheapened if it's sold as an article of commerce. If you can just buy it on eBay, it doesn't have the same meaning."

When officials from the Academy of Motion Picture Arts and Sciences, the Oscars' awarding body, spotted the genuine Oscar for sale on eBay, they immediately had eBay close down the auction, and contacted the sellers demanding details of its provenance.

Randy Mariani claimed that he had worked in a potato chip business next to R S Owens, and that he'd found the statuette thrown out with the garbage, but an investigation discovered that the company had closed down before Malden had sent his award to Owens'. The Marianis had originally agreed to sell the statuette back to the Academy, but had reneged on that deal.

Karl Malden and the Academy are now suing the Marianis for copyright infringement and false representation.

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"No secret sauce," says Kazaa, Skype founder

A fascinating article about and interview with Niklas Zennstrom, founder of Kazaa, Skype and a new internet TV venture, The Venice Project. Some highlights:

Zennstrom does not seem to have an outsized ego - until he talks about his ambitions for Skype. When he started it in 2003, he told Fortune, "There is multibillion dollars in potential in Skype. We're not here to try to make some small business."

"It's the same plan," he says now. "We have 136 million users. There aren't many telephone companies that have more customers. We are still in growth mode. In terms of revenue per user, Verizon gets much more, but they also have much higher costs."

"We didn't plan to sell," Zennstrom says. "We started a conversation with (eBay CEO) Meg Whitman because we thought we should work with eBay." He actually thought eBay wouldn't like Skype because a Skype voice connection could be a way for sellers and buyers to cut deals that eBay couldn't track.

Whitman saw something else: a fast-growing business that might also help eBay users talk to each other and close transactions more easily, especially those that involve big-ticket items like cars. "We always seek to remove friction from e-commerce," Whitman told USA TODAY soon after the Skype deal. "It leads to a better experience and an increase of velocity of trades."

Whitman has been criticized for the deal by analysts and investors. She has not clearly shown how Skype helps the eBay site - though, on the flip side, it's clear that eBay's marketing muscle has helped Skype grow 122 percent in North America in 2006.
Zennstrom insists he's happy with the marriage. "You never know how the chemistry will be, but it's been really great," he says. "Meg did not impose on us to do everything the eBay way." He says he's learning a lot about management from Whitman and other eBay executives.


Friday, 15 December 2006

And you thought Royal Mail were bad...

Russian Post has started delivering 4.5 tonnes of letters and parcels that were sent from the United States in 1999. The state-owned mail service said that the mail had been in a ship which had been stuck in a Finnish port for years, but that the post was all in good condition as it had been in an hermetically sealed container.


eBay trading competition in the North East - enter online

The North East Regional Portal is launching a new competition "You Trade" to encourage online entrepreneurship in the North of England. Open to residents of Northumberland, Tyne and Wear, County Durham and Tees Valley £2000 will be awarded to get contestants started trading on eBay.

Budding eBay sellers need to submit a business plan which will be judged by a panel of industry experts with the ten successful applicants announced by 9th February. A condition of entry is that they start trading on eBay by 31st March. They will also have to demonstrate how they will support themselves during the year and of course confirm that their business will trade on eBay. Entry is not open to anyone who currently has a business registration with eBay.

It often seems easy to say "Lets start an eBay business" but the truth is most successful sellers either grow organically expanding from profits, or already had a business and migrate to eBay as a second income stream. Many sellers complain if they "just had the money for stock" they'd be able to compete. The truth is that someone else always has more to invest than you and it really is possible to build a substantial business from a tiny initial investment. eBay is a fiercely competitive environment where only the fittest survive long term.

This does remind me of the Guardian competion from 2005 where seed money was £1500. Do competitions like this really produce winners - or is it a publicity stunt? Do the winners go on to build successful ongoing businesses? The eventual winner of the Guardian competion has shut up shop on eBay. Although they continue as an avid eBay buyer they no longer sell on the site. Having said that the two closest runners up are still trading, so maybe the wrong winner was chosen.

We'll watch with interest as the ten new competitors enter the online fray and see how they fare. The true test is not during the competition, but also if the businesses they start are sound and can stand the test of time.

If you live in the North East you can apply at, deadline for entries is 8th January 2007.

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Philipp Justus, Michael Linton, now Henry Gomez replaces Alex Kazim...

Henry Gomez is to replace Alex Kazim as President of Skype. Just over a year ago Gomez took on his role as general manager of Skype North America to provide a focus for enhancing Skype's performance and growth in North America. From there he has progressed to CMO & Director of Operations for Skype and now gets the top job.

Kazim, joined Skype from eBay and is now returning to eBay, where he previously spent eight years, to work on strategic projects.

First Justus, then Linton now Gomez and Kazim... there are still some key management appointments to come in key areas of eBay's business before everyone is in their allotted slot. There's an awful lot of people reporting to Bill Cobb now, who reports directly to John Donahue. However with the new cross-functional teams one wonders just how rigid the lines of management will be, bearing in mind the new positions are created to give greater flexibility and pass decision making ability to those in the front line.


Preapproved Velvet Underground

Warren Hill and Saturn Records are trying again. Having failed to secure a sale for the rare recording of the Velvet Underground due to an auction wrecker they have relisted the item for sale.

It's expected that the preapproved bidder facility will be withdrawn in the New Year. Although no official announcement has been made the following notice appears on the US site

Beginning in January 2007 access to this feature will be restricted. Prior to the restriction time you will be able to use the feature, but once the restriction takes place you will not be able to add or remove any buyers from the pre-approved bidder list for the item

This will be one of the last high profile auctions to use the pre-approved bidder feature whilst it's universally available, in the future sellers will be forced to use Buyer Requirements to filter unwelcome bids. Currently the auction wrecker (who uses the classic excuse "someone bid using my account") still has his eBay account. I wish eBay would close accounts for auction wreckers and for instances where "someone bid using my account"!

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Finally: a policy announcement on counterfeits

eBay have at last made an announcement on the new policies to reduce counterfeits implemented two weeks ago.

The new rules begin with an impassioned statement that fakes are not just an eBay problem, but that they undermine the entire marketplace. As we've seen, Paypal verification, the restriction of one and three day listings (commonly used by scammers in the hope of evading detection by selling quickly), and being an established eBay member are all parts of the strategy.

Then comes the shocker:

Sellers registered in the UK, U.S., and Germany may post these items worldwide.

Sellers in English-speaking markets – UK, U.S., Australia, and Canada – will be able to list and post these items freely across these sites. For example, a UK registered seller will be able to list an item on the US site.

Sellers in Germany, Switzerland and Austria will be able to list and post these items freely across these sites, with the exception that Austrian sellers won't be able to post to Switzerland.

Sellers in France and Belgium will be able to list and post these items freely between these sites, with the exception that French sellers won’t be able to post to Belgium

Sellers in all other countries will only be able to list and ship these items domestically.

eBay's restricting trade within the EU? I assume the legal team have checked this out, but it seems unnecessarily harsh.

Perhaps most annoying for sellers, though understandable from eBay's point of view, is that eBay are do not state to which items the restrictions will apply. Sellers of legitimate goods have, over the last fortnight, found themselves unable to sell their stock until they have completed a "review" whose process has not been made clear to them, and with no kind of public timeline. No remedy for this situation seems forthcoming. There is apparently no way for sellers to check, before purchasing stock, whether it is likely to trigger a "review" or not: once more, sellers are left at the mercy of eBay's whims, and that can't be good for anybody's business.

[At the time of posting, I'm unable to find any version of this page on the US site. However, I'll keep looking: I'd expect it to be updated later today.]


Giving Works

Good news for eBay for Charity: bidders on charity listings are willing to pay more for their items. Research by the Olin School of Business at Washington University in St. Louis showed that on average, buyers of charity-linked products are willing to pay 5% more. Interestingly, as the item becomes more expensive, however, the charitable element becomes less marked: "It's as if people have in mind a maximum donation that they are willing to make to a charity," said the researchers.

Canny sellers might use this to their advantage: listing with eBay for Charity can bring added exposure to your listings as well as helping you raise money for your favourite charity.


Chinese whispers

More rumours about eBay China: today's version says that Eachnet, Paypal and Kijiji are to be split up. The source is apparently an eBay insider. eBay will keep Eachnet, the auction platform, while Kijiji, a free classified ads site, will be run independently. No eBay China story would be complete without the involvement of Tom Group, who here are rumoured to be about to receive a proportion of Paypal's Chinese operation.

Both eBay and Tom Group have, as ever, refused to comment.


Thursday, 14 December 2006

I think I'm gonna put this on eBay


The auction is live!

The question on everyone's lips is Will It Blend?, a Brainiac-style website which has tried to blend everything from a MacDonalds meal to coke cans, mobile phones and golf balls. Their latest experiment was will an Ipod blend. The results, together with a brand new blender for your own kitchen or lab, go on sale on eBay tomorrow. This is viral marketing at its best.


Diana ticket touts kicked off eBay

Tickets for the Concert for Diana seem to be almost more sought after than the PS3 this week. eBay took the decision to ban them from re-sale on the site, before they went on sale yesterday morning. Needless to say the official source sold out within minutes of sales opening, leaving many disappointed buyers who failed to secure a ticket.

eBay moved quickly to remove all auctions that were placed on the site for Diana tickets, working in conjunction with the event organisers and Royal press office. Last night a spokesman for Clarence House said: "We are very pleased that eBay have taken this decision." No one will be paying over the odds putting money into the pockets of touts on eBay.

Sadly this isn't the case elsewhere. Tamebay pointed out that eBay's sponsored links on Google were unfortunately picking up on the phrase "Diana Tickets". eBay moved swiftly to rectify this, and the ad was removed. Other companies are not as ethical - currently a company is paying for the first result on Google directing buyers to their site where tickets are on sale for an incredible £338.29

As with all events of this nature there are plenty of people willing to pay over the odds for tickets. The organisers seem poorly prepared to cope with inevitable re-sales and the many channels available to touts. Simple steps like issuing tickets to named people and requiring photo id to gain entry would have deterred profiteering. The ticket price seems exceptionally low as well at £45, compared to similar concerts which don't benefit charity - with the rocketing levels of demand, a higher price would have raised much greater funds for the benefitting charities.

It's a shame the organisers didn't work with eBay to place a certain number of tickets for sale through eBay for Charity to raise more funds, and allow those desperate for a ticket to bid knowing they're donating at the same time.

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Bad guys "don't lose sleep" about eBay bans

Three postmen who sold items stolen from the mail on eBay, have been jailed. The trio took items such as jewellery, ipods and mobile phones, valued at a total of £15,000, from the Royal Mail returns depot in Dallam. They were arrested last November after being caught on CCTV.

A Baltimore man has been convicted of stealing baseball memorabilia from the Orioles to sell on eBay. The stolen items included old Orioles media guides, used jerseys and game jackets. The thief was caught when a team employee saw one of the player's bobblehead dolls for sale on eBay before it was publicly available.

Five people from the Chicago area have been charged with selling stolen luxury goods on eBay. Shoplifters were delivering their stolen items to two pawn shops, from where they were listed for sale on the site. The five charged were all employed at the pawn shops.

An eBay spokeswoman said there's no way for the site to vouch for the origins of products sold there and that the only recourse company officials have is to ban suspect sellers from operating.

"The reality is, if you're a bad guy, you're not going to lose too much sleep about being kicked off eBay," said spokeswoman Catherine England. "At the end of the day, law enforcement has a much bigger stick than we do."


2500 Post Offices to close

Alistair Darling, the Trade and Industry Secretary, has just announced the closure of around two and a half thousand UK post offices, mainly in rural locations.

The Minister said that the government wished to restructure the network on a stable economic footing, promising £1.7billion to be invested over the next five years. To ensure that 99% of the UK population remains within 3 miles of a Post Office, new mobile Post Offices will be set up, together with more located in shops and community halls.

Though fewer closures than were originally predicted, this is still a blow for thousands of eBayer sellers whose businesses rely on their local POs. eBay selling is often attractive to those living in rural locations where other work is not readily available. To damage business like this hurts not only the individual seller, but the fragile economy of which they are a part. With 5000 closures already over the last four years, many eBayers already have a longer journey to their nearest Post Office. Further closures in rural locations will simply make it unviable to carry on selling on eBay for some.

For others, faced now with long treks to overcrowded town-centre offices, the only option will be collection by Royal Mail instead, or moving to courier delivery, sending ever more revenue away from the Post Office. Just as Lib Dem T&I shadow Malcolm Bruce said in 2004 that "the closure of up to 3000 urban post offices this year will not stop the rot", today's actions have just set the stage for a further round of closures in coming years. Unless the government abandons its current schemes moving more and more services out of Post Offices, things can only get worse.

Instead of creating yet another unnecessary barrier to enterprise, the Minister for Trade and Industry should recognise the vital role of small business in the UK economy, and, whether those businesses are eBay traders or rural Postmasters, do so much more to support them.


Skype buttons on eBay obsolete

eBay have dragged their feet introducing Skype buttons in all categories but why worry? With the release of Skype version 3 all you need in your auction is your phone number and Skype will turn it into a clickable link for your customers. In fact it will turn any phone number on a webpage into a a clickable link to initiate a phone call. If you're in the UK and the number is a landline (begining 01 or 02) you can get free calls for the next six months by spending £10 on credits for other Skype services such as voicemail, SkypeIn or SkypeOut.

eBay spokesperson Hani Durzy said "Although it's still early, we see opportunity in the Skype Me buttons, particularly on higher priced categories like motors, jewelry, and electronics where buyers often have detailed questions for sellers." He said eBay continues to gather feedback from the community to improve functionality. Too little, too late!

Regardless how enthusiastic Durzy is about Skype buttons the facts are that eBay have been too slow to allow use of Skype buttons in all categories. By the time they allow them it may well be too late and be superceded by click to call. Don't forget you can get a SkypeIn number which acts as a land line but directs calls to your computer. If you want to take Skype calls on your normal handset consider the RTX SKYPE Dualphone 3088 for Skype and landline calls in one handset!


Wednesday, 13 December 2006

Get Loot, with Paypal

Loot, the classfied ad publishers, have announced that their website will begin accepting Paypal payments. The majority of Loot's ads appear free both in their magazines and online. With two million searches performed on the website every week and a print readership of 530,000, this is a fantastic coup for Paypal.


Skype version 3 full release with free phone calls

We blogged on the 2nd December about Skype 3 and the fantastic new features due to be released. Well the good news is that today it was released in full. One of the best additions is click to call for FireFox and Internet Explorer. Any phone number on a website turns into a clickable skype button - with free calls to UK landlines for six months if you spend £10.00, this is a must have.

If you're in the US don't worry - you can get unlimited calls to any US number for just $14.95 for the year (sign up before the end of January; normal price is $29.95). It's likely that calling plan offers similar to this will be introduced in the UK once the six months free calls are up. Skype are concentrating on building a customer base and will look to monetise it in the future.

Go and download the latest version of Skype today!

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Code soup

Yesterday's problems with Paypal continued this morning with many sellers reporting problems with eBay's Checkout. These problems made a welcome change from last week's Paypal problems, when new payments were not flagged as new, and from the week before, when eBay's auction management software, Selling Manager Pro, failed.

Despite being widely reported as if it were actually news, this kind of breakdown in site functionality is something that eBay sellers deal with every day. And it's about time it all got fixed. Properly.

Go on any eBay message board these days, and you'll find that "PNR" is some kind of in-joke. It stands for "page not responding", eBay's error page in case of server failure. And it's something that every eBay seller knows well, just as well, in fact, as they know that ten days after a cheap listing day, the site will grind to an over-burdened halt. Recent CLDs in both the UK and Canada had to be extended because their initial implementation was faulty. One has to wonder just what their programmers are doing, and whether they actually have a test server.

But it's not just the site architecture that's below par: its front end is horrible code soup too. With a recent report critising 97% of websites for failing accessibilty guidelines, eBay might be forgiven for thinking they can get away with the multiple nested tables, single pixel shim layout they've got at the moment, but it can really be only a matter of time before someone, somewhere decides to get the lawyers involved.

When was the last time that eBay's site got rewritten from the ground up? Not in the last seven years while I've been using it. I can understand that with literally millions of lines of code, this is a major task. That's why it needs to be done now. The current state of affairs, where each new feature breaks something and needs more bodges to hold it all together, cannot go on much longer.

For Cobb's sake, can we get this fixed?

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Governer's grounded but auction takes off

Ever fancied your own plane? Well the State of Alaska is selling three surplus aircraft already but is soon to list the former governer Frank Murkowski's jet. Bidding is unlikely to reach the record price set by the sale of a Gulfstream on eBay - $4.9m but the sale price is expected to be around $2.5m

With bids on 33 of the 38 items Alaska currently has listed on eBay their sell through record is pretty good, and only one of the planes currently for sale has yet to reach it's reserve price. Whether the controvesy caused by the original purchase of the plane along with Murkowski's parting shot that it's actually not that comfortable will affect the bidding has yet to be seen.


Just check my feedback

Via Molly's Diary, we found this rather cute widget to allow you to display your feedback on a non-eBay website. Great for building confidence in your website shoppers, or just showing off on a personal site!

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Diana tickets banned on eBay

eBay announced this morning that it was banning the sale of tickets for the Concert for Diana as a mark of respect to her memory. Tickets only went on sale this morning, but some listings have appeared on the site already, though they are being removed almost as quickly as they're listed.

eBay will be contacting the charities involved to suggest ways in which they can raise money for the Princess's favourite charites through eBay for Charity.

It's nice that eBay are considering public sentiment on this matter, and the speed with which they are dealing with listings is impressive, though perhaps someone should have told whoever buys their Google adwords:
Google ad for Diana tickets on eBay


PayPal monstered

"Monster, a leading career and recruitment resource, announced that its ecommerce site now accepts eBay's PayPal online payment service" reports Ina Steiner. "Employers will be able to pay for Monster's recruitments products online."

Sadly a phone call to Monster in the UK reveals that payment terms are by credit card or invoice. Whether PayPal will come to or not remains to be seen, but what is significant is that they chose PayPal above Google to integrate onto their website.


Tuesday, 12 December 2006

21 charged with fake SCO fraud

US law enforcement officials have charged twenty-one people with fraud relating to fake second chance offers sent to eBay buyers. The gang are accused of collecting more than US$5 million from more than 2000 transactions.

Generally, victims who bid unsuccessfully on items were led to believe they were being given a "second chance" to purchase items and were instructed over the Internet to send money via Western Union to be picked up by the seller or the seller's agent, generally in the Chicago area.

If convicted, each defendent faces a maximum penalty of twenty years in prison and a fine of $250,000, as well as paying back the money they stole.

As ever, the advice to those receiving second chance offers is to sign into My eBay and check the "items I didn't win" section, where any genuine second chance offers will show.


Prince Charles "sells tickets on eBay"

The Royal Variety Performance was hosted by Jonathan Ross who opened by joking that the host should have been Nick Ross. He then went on to quip he had to buy his ticket on eBay and the seller was HRH from Highgrove (whilst smiling at The Prince of Wales - Prince Charles).

The Royal Variety Performance took place on Monday 4th December and is to be screened on BBC1 on Tuesday 12th December.

It's intersting to see just how ingrained eBay is into the media, even with Royalty present. Lets just hope eBay UK don't have to do what the Australians did and fight to keep Ross's ticket ;-)

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Parcelforce low cost Christmas deliveries

Send a parcel anywhere in the UK from just £10.99 for Parcelforce 48 and £11.99 for Parcelforce 24. The offer runs for all eBay sellers from the 13th to 21st of December 2007. Parcelforce will collect from your doorstep and deliver to your customer and you don't even need a ParcelForce account to take advantage of the offer.

There are some terms and conditions but this is a great opportunity to sell those heavier items and qualify for eBay Get it Fast. Let your buyers know their purchases will arrive in time for Christmas. This offer was previously only available to PowerSellers but is now open to all eBay sellers.

Of course if you need to send a lot of parcels it's worth opening an account so don't forget the free wine promotion.

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And the accountant said.....

A businessman was interviewing applicants for the position of divisional manager. He devised a simple test to select the most suitable person for the job. He asked each applicant the question, "What is two and two?"

The first interviewee was a journalist. His answer was "twenty-two."

The second applicant was an engineer. He pulled out a calculator and showed the answer to be between 3.999 and 4.001.

The next person was a lawyer. He stated that in the case of Jenkins v. Commer of Stamp Duties (Qld), two and two was proven to be four.

The last applicant was an accountant. The businessman asked him, "How much is two and two?" The accountant to be got up from his chair, went over to the door, closed it then came back and sat down. He leaned across the desk and said in a low voice, "How much do you want it to be?"

He got the job.


Accounting for your accountant

It's almost the time of year to pay the final tax bill which prompted a visit to my accountant today. This got me thinking - just how does the typical eBayer view their accountant? A while ago in conjunction with another eBayer I wrote a guide "BOOK KEEPING, TAX & BUSINESS REGISTRATION" which examined the basics of keeping financial records. Many sellers on eBay appear to leave record keeping to their accountant and view them as little more than glorified bookkeepers.

Accountants should have a much more active role in a business then simple book keeping and completing a tax return. Discussions with mine today focussed on plans for the last three months of the 2006 - 2007 tax year to minimise next years tax bill. One possible idea is to purchase a motor specifically for business use - commercial vehicles can be fully offset as a business expense, VAT can be claimed back and all servicing and running expenses are deductible. This affects my decision to replace either my car or the 4x4 I currently use and of course purchase of the new vehicle can be done in the most tax efficient way possible.

The other good news from the meeting today is that my accountancy fees for the year will actually be less than previously charged. This is due mainly to keeping records up to date and leaving very little work for my accountant to do. The way I keep records is described in another eBay guide "Basic Excel Accounts and Book Keeping for eBay Sellers". By keeping records all my accountant has to do is tally the columns and include allowances for which there isn't a direct cost - like use of my home office.

To hand over a pile of receipts and sales data to an accountant is wasting their qualifications, book keeping isn't that onerous if done daily or weekly. Consider them as an expert business advisor and allow them to have input on shaping your business for the future. Don't make decisions and purchases and then expect your accountant to "get the tax back". Discuss in advance and find the best way to invest your money in the first place. Use them as the highly paid consultant that they are... you never know, your accountant may turn round and tell you they're reducing their invoice too.


Robbed of $155,000

Last Wednesday we blogged Warren Hill the man that found the rare recording of the Velvet Underground for just 75 cents on a market stall and was selling it on eBay. Bidding closed at over $155,000 but sadly it appears the high bidder was a time waster.

Oakland-based Saturn Records, which oversaw the EBay sale, also reportedly received an apologetic e-mail from the man believed to be the successful bidder, saying the bid was submitted without his knowledge by a prankster friend using his computer and eBay account.

We hope that eBay will take action against the account. The second clause of the eBay User Agreement emphasises that a user is responsible for all actions taken on their account, and if you don't log out and keep your password secure you don't deserve the right to use eBay.

This does leave the question unanswered as to whether Saturn Records made good use of their buyer requirements which all sellers should be using to reduce instances of unwelcome bidding.


Don't dream it, bid for it!

A British company is offering a white Christmas for sale on eBay in aid of the NSPCC. SNO!zone will deliver ten tonnes of real snow to "an appropriate area of the winning bidder’s property" on Christmas Eve. There is apparently no provision for the snow to be removed; the lucky winner will just have to do that themself.

Via Ananova.

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Too much monkey business in a bear market

After recent bullishness about eBay's share price, we were due a nay-sayer. Amey Stone thinks it's time to sell:

Will the holidays be good for eBay? As a one-time eBay shopper, I'm skeptical. There remains a long-term risk to the stock that too little customer service and too much monkey-business by scammers will erode market share in the year to come.


The effects of free postage

Businesspundit points out an interesting article from Harvard Business School, which might add to the perennial debate amongst eBayers as to whether 'free' (i.e. included in the headline price) shipping fees are a good idea:

A "simple" all-inclusive price will lead buyers to focus on the main benefit offered, while partitioned price formats (main price + other charges) stimulate people to look into the details of what they get for their money. Thus, price framing can be used as a tool to induce consumers to acknowledge additional points of differentiation: a convenient shipping method or a useful service plan, for example.

With eBay, like many other online shopping sites, pushing free postage this Christmas, this seems to suggest that 'no shipping fees' isn't quite the universal panacea that people take it for. In my experience, the most important thing is clarity, quickly followed up by simplicity: a buyer who needs a calculator to figure out your postage prices is a buyer who's hit the back button.


Customers "not an absolute priority" for Royal Mail

The UK postal service has been slammed as "chronically poor" by a committee of MPs. Some areas, including London, are particularly badly served by Royal Mail, which sees over fifteen million items a year lost, stolen or damanged.

The MPs also criticised the compensation process offered by RM, which they said was inadequate and overly complicated. The chairman of the committee, Edward Leigh MP, said:

"You would expect that a new regime for the quality of postal services would aim to improve collection and delivery times and reduce the number of pieces of mail lost by Royal Mail. If so, you would be mistaken. Neither of these aspects of performance is targeted under the current regime introduced in April of this year. Given that people are now receiving their mail later in the day and that over 15 million letters and parcels are being lost, stolen or damaged in a year, it is pretty clear that the interests of ordinary users of the post are not an absolute priority."

Royal Mail is also due to announce the closure of thousands of post offices on Thursday.


Monday, 11 December 2006

Knight Rider's car for sale on eBay

Anyone of a certain age would have watched Knight Rider as a child, well now there's an opportunity to own Knight Rider's car.... well ok, not KITT driven by Mitch Buchanon, but a Porsche once owned by David Hasslehoff himself!

If the current price of $5300 (plus of course shipping to the UK) is a bit steep for your pocket don't worry - you can sate your nostalgia and relive the eighties with KITT on


Boo Hoo Tube

The twenty-first century's when everything changes

Controversial Dr Who spin-off Torchwood's most recent episode featured an eBay sale at the heart of its plot. If you missed it, you have another chance to catch it tomorrow.

Eugene awakes to find himself both dead and invisible. Though the rest of Torchwood dismiss him as just another loner obsessed with aliens, Gwen feels drawn to him and his collection of 'alien artifacts'. Together, they reconstruct Eugene's last two weeks alive, hoping to discover just why he's still here.

The answer (and if you haven't seen the episode yet, look away now), is a Dogon's sixth eye, part of Eugene's collection, which he'd put up for sale on eBay. Bid up to £15,005.50 by two of his workmates for a joke, there's a strong hint that the underbidder might have been genuine. Could Eugene have sent a second chance offer to an alien? Sadly, the program didn't go there.

Though it's tempting to point out that Eugene's friends bidding on his auction is in violation of the shill bidding policy, and bidding with no intention of paying is also against eBay rules, really it was a great indication of how ingrained eBay has become in popular culture. "Sold online" and "sold on eBay" were synonymous as far as the programme was concerned, and the writers found no need to explain what eBay was or how it worked.

Sadly, it wasn't the most thrilling episode of the series so far. The most exciting part was probably the live-updating eBay bid amount: how cool would it be to watch your high bidder hit £15,000 without having to sit hitting the refresh button? Now *that* would be a excellent new feature.


Worst. Timing. Ever.

In a bout of terrible timing, eBay UK last week changed the organisation of the video game and consumer electronics categories, as well as making massive changes to the Business, Office and Industrial category. The announcement was made today. It might have helped sellers hoping to take advantage of one of the busiest shopping weeks of the year if this had been announced when it was implemented, and not a week later.


Post and Packing Banned!!

Fee avoidance has always been an issue that eBay have struggled to combat. Fee avoidance takes many forms but the latest drive is to eradicate items with low prices but unreasonably high shipping charges - eBay have committed to crack down on this practice. eBay appear however, to be removing auctions with reasonable postage through ignorance of actual costs whilst ignoring auctions in categories where fee avoidance is habitual and blatant.

It is undoubtedly a poor buying experience to find an item you want at a great price just to discover that the postage cost is many times the bid price. This is especially bad when the postage price isn't shown in search results and a great argument for eBay to present total price, including shipping to the buyers location, instead of the item price. At the same time the practise disadvantages buyers who list the true selling price with realistic shipping charges as buyers are likely to home in on the lowest cost items bypassing the more expensive. This undermines the marketplace for both buyers and sellers.

Sadly their drive to rebalance the marketplace seem to be targeting the wrong auctions. Rather than concentrating on prolific fee avoiders they have been removing listings which have legitimate postage charges commensurate with the weight of the item and method of shipping. Recent examples of removed auctions we are aware of include

A heavy hardback book with postage charge £5.50
Actual cost £3.85 for standard parcels
Actual packaging materials £0.85
Total £4.90 leaving £0.60 for handling and sundries

Telephone equipment weighing 8kg with postage charge £12.00 (specified as courier delivery from a VAT registered seller)
The lowest cost on the ParcelForce rate card for 8kg would be £14.25 (plus VAT) so £12.00 is reasonable.
As an alternative a 3-5 day delivery actual cost £9.97 for RoyalMail standard parcels
VAT on £9.97 = £1.75
Total cost £11.72 leaving £0.18 for packaging and handling. (NB This is the cheapest method available)

In these two examples if eBay were familiar with actual shipping costs quoted by Royal Mail or couriers perhaps they wouldn't remove these auctions. To demonstrate just how poor eBay's understanding of shipping methods and costs are you only have to look at the examples they provide in the Excessive Postage & Packaging Charges Policy.

The Matrix Reloaded DVD
BIN: £3.99
Domestic Postage UK £2.00 Royal Mail Second Class
Explanation: The seller is sending the item via Royal Mail First Class parcels and is charging actual postage prices plus a reasonable fee for packaging and handling.

In this example just what postage are they looking at? Second class? First class? Standard Parcels? If eBay can't research shipping charges sufficiently to write their own policy it's unrealistic to expect their customer service reps to implement the policy with any understanding.

To make the situation worse statements from eBay to sellers whose auctions were ended have been "We want each seller to have a balance in their listings, between the price and the shipping cost. So therefore I urge you to adjust them" or "relist the auctions with a postage cost below the original costs to show you've complied with the policy" (How much below?) "Just a little lower". Such messages have naturally been treated with the contempt they deserve when actual or close to actual postage costs have been charged. Instructing sellers to incorporate shipping costs into the item price whilst others don't is not providing a balanced marketplace.

Removing auctions for sellers where postage is high in comparison to the item cost, but where weight is significant and suggesting that sellers reduce postage below cost and incorporate it into the selling price also raises accusations of profiteering on eBay's part. eBay make fees on final value prices (and on listing fees if starting prices are higher). They do not make fees on postage. It's worth noting sellers will simply increase selling prices to take fees into account degredating the buyer experience yet further.

There have been calls in the past for the postage to be incorporated into the item cost removing all ambiguity. This naturally raises difficulties when shipping costs vary between domestic and overseas destinations.

If eBay really want to start reducing fee circumvention they should look at categories such as MP3 players with shipping regularly ten times the cost of the item! Fee avoidance is sadly just the tip of the iceberg, sellers that resort to it often have grossly unfair and often illegal terms and conditions of trading. Examples include

"All items will be sent by Registered Air Mail and mark as "Gift"" (which is illegal and breaks Customs regulations)
Quoting shipping and in the small print plus "required insurance for the each item" (gouging even more money from the buyer without paying eBay fees)
"All sales are final, no return or refund will be issued" (so if it's faulty they won't help you)
"We reserve the right not to refund S&H when the item has been posted" (meaning if the product is defective they don't refund you for the grossly overcharged postage - just the couple of quid for the product)

Muddying the water further some fee avoiding overseas sellers with low price high postage products have started to incorporate Union Jacks in their gallery pictures to trick buyers to thinking items are located in the UK.

- Unhappy buyers who fall for outrageously high postage charges and compulsory insurance
- Unhappy buyers snared with illegal or unreasonable terms and conditions
- Unhappy buyers who have a poor buying experience trying to wade through auctions with unreasonably high postage charges
- Unhappy sellers who feel their auctions are removed unjustly whilst seeing many others remain
- Unhappy sellers unable to compete against those trading unfairly

eBay desperately need to get a handle on fee circumvention in general and excessive shipping charges in particular. In their own words "Listings that include excessive P&P fees lead to a poor buying experience and unlevel the playing field by putting sellers who charge reasonable P&P charges at a disadvantage. These listings undermine the trust and legitimacy of eBay’s marketplace." Trust and legitimacy works both ways, it doesn't include removing sellers auctions that have reasonable postage costs whilst the site is infested with auctions that not only blatantly avoid fees but have darn right illegal trading practices.

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Sunday, 10 December 2006

Fraud tracking software hasn't got a clue

Engineers at Carnegie Mellon University have come up with software that is supposed to reveal fraudulent behaviour on eBay:

Sites like eBay rely on users to warn others if they have a bad experience with a seller by rating their transactions. But the CMU researchers said savvy fraudsters get around that by conducting transactions with friends or even themselves, using alternate user names to give themselves high satisfaction ratings - so unsuspecting customers will still try to buy from them. The CMU software looks for patterns of users who have repeated transactions with one another, and alerts other users that there is a higher probability of having a fraudulent transaction with them.

Now I'm all for making fraud easier to detect and harder to perpetrate on eBay, but it seems to me that the manufacturers of this software don't have a very good idea of how eBay works.

For example, I have customers who buy beads off me at least once a week, every week. I hope I don't have to say here I'm not buying my own stock, but for the record: I'm not, these are genuine customers. They're also buying regularly off a handful of my closest competitors. But there's more: my competitors and I also buy off each other. Most of us make beady things ourselves, so we buy to make. And inevitably there's the odd stock control problem, when we have to buy off a competitor to fulfill our own orders.

This can't be particularly unusual. Many collectors and dealers in specialist items would show up similar trading patterns, whether it be in china or classic cars. I have no idea whether such activity would be flagged by CMU's software: perhaps it's subtle enough to take the category being examined into account.

Johannes Ullrich, an Internet fraud expert with the SANS Institute in Bethesda, MD., said the CMU researchers must find a way to screen out false positives.... being wrongly flagged as high-risk for fraud.

I can't help feeling it says something rather sad about their perception of eBay that they would take repeat transactions as a sign of fraud, rather than a sign of excellence.


Your very good elf

So it's Sunday, it's wet and cold out, the kids are climbing the walls, you already put your Christmas decorations up - what's next? How about a little Christmas dressing up?

Here's one we made earlier, featuring Jess, head of customer services for Mountcomp.

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Lord, won't you buy me...

File under "hopelessly optimistic", or maybe just "likes paying listing fees", seller j_james22 has a copy of the Bible allegedly autographed by the Author for sale. Together with his new variant of the 'jar of air for sale', a jar of God's love, if JJ manages to find a buyer for these, he's going to have a very happy Christmas indeed.

Via Kowtower.