eBay 2002 Annual Report Download - page 9

use the Buy-It-Now feature at the time of listing, which allows sellers to name a price at which they
would be willing to sell the item to any buyer. Listings that oÅer the Buy-It-Now feature are conducted in
the normal auction-style format, but will also feature a Buy-It-Now icon and price. Until the Ñrst bid is
placed, or in the case of a reserve auction, until the reserve price is met, buyers have the option to buy the
item instantly at the speciÑed price without waiting for the auction to end. A seller can elect to sell items
in individual item listings or, if he or she has multiple identical items, can elect to hold a ""Dutch
Auction.'' For example, an individual wishing to sell 10 identical watches could hold 10 individual auctions
or hold a Dutch Auction in which the 10 highest bidders would each receive a watch at the price bid by
the tenth highest bidder. To be eligible to hold a Dutch auction, a seller must have a suÇciently high
feedback rating and must have been a registered seller for at least 60 days. A seller may also specify that
an auction will be a private auction. With this format, bidders' email addresses are not disclosed on the
item screen or bidding history screen.
Sellers generally pay a nominal listing fee to list items for sale. By paying incremental placement fees,
sellers can have items featured in various ways. For example, a seller can highlight his or her item for sale
by utilizing a bold font for the item heading, have his or her auction displayed as a ""Featured Auction,''
which allows the seller's item to be rotated on the eBay home page, or utilize the Buy-It-Now feature,
which enables a seller to close an auction instantly once a speciÑed price is reached.
When an auction ends, the eBay system validates whether a bid has exceeded the minimum price,
and the reserve price if one has been set. If the auction was successful or if the buyer elected the Buy-It-
Now feature, we automatically notify the buyer and seller via email, and the buyer and seller can then
complete the transaction independent of us. At the time of the email notiÑcation, we generally charge the
seller a Ñnal value fee. eBay does not take possession of either the item being sold or the buyer's payment
for the item. Rather, the buyer and seller must independently arrange for the shipment of and payment for
the item, with the buyer typically paying for shipping.
Under the terms of our user agreement, if a seller receives one or more bids above the stated
minimum or reserve price, whichever is higher, the seller is obligated to complete a transaction. We have
no power to force the seller or buyer to complete the transaction, other than to suspend them from using
the eBay service in the future. In the event the buyer and seller are unable to complete the transaction
and the seller notiÑes us, we have the right to credit the seller the amount of the Ñnal value fee.
Invoices for listing, feature and Ñnal value fees are sent via email to sellers on a regular (at least
monthly) basis. We require all new sellers to have a credit card account on Ñle. Sellers who pay us by
credit card are charged shortly after the invoice is sent. A summary of our eBay.com fee structure, as of
March 15, 2003, is provided below. All pricing is subject to change.
Listing Fees
Minimum Bid, Opening
Value or Reserve Price Listing Fee Special Categories Listing Fee
$0.01 - $9.99 $0.30 Passenger Vehicles or
$10.00 - $24.99 $0.55 Other Vehicles $40.00
$25.00 - $49.99 $1.10 Motorcycles $25.00
$50.00 - $199.99 $2.20 Real Estate $50.00 - $300.00
$200.00 and up $3.30
Reserve Price Reserve Price Fee*
$0.01 - $24.99 $0.50
$25.00 - $99.99 $1.00
$100.00 and up 1% of reserve price
(up to a maximum
fee of $100.00)
* Reserve price fee is fully refundable if item sells
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