eBay 2010 Annual Report Download - page 8

We seek to create a global platform that provides individuals and businesses of all types and sizes with access
to broad markets. We have aggregated a significant number of buyers, sellers and items listed for sale, which in turn
has resulted in a vibrant online commerce environment. Our buyers enjoy an extensive selection of goods and
services. Key components of our community philosophy are maintaining honest and open marketplaces and treating
individual users with respect. We seek to maintain the satisfaction and loyalty of our buyers and sellers by offering a
variety of community and support features, such as announcement and bulletin boards, customer support boards and
personal pages, as well as other topical and category-specific information exchanges.
Generally, we believe our Marketplaces platforms are more effective, relative to most available alternatives,
at addressing markets of scarce new goods, new items that are no longer in-season, end-of-life products and used
and vintage items. Our highest growth rates in gross merchandise volume (GMV) and sold items in recent
periods have been in our fixed-price listing format, primarily for new items that are no longer in-season. We
define GMV as the total value of all successfully closed items between users on eBay Marketplaces trading
platforms during the period, regardless of whether the buyer and seller actually consummated the transaction
(excluding eBay’s classifieds websites, Rent.com and Shopping.com). We offer our buyers additional ways to get
access to discounted or value-priced products, including through our “Daily Deal” program, where we offer
multiple deeply discounted deals from sellers every day, and our “Fashion Vault” program, which offers limited-
time, online sales of brand-new designer fashions and accessories. Through our eBay Bucks rewards program, all
buyers in the U.S. have the ability to earn eBay Bucks on qualifying purchases made on eBay.com. Upon the
completion of each calendar quarter, participating buyers are issued eBay Bucks certificates for their qualifying
purchases during that quarter, which are redeemable for a limited period from issuance for future purchases on
eBay. The breadth of our community of active users has contributed significantly to our historical success. We
had approximately 94.5 million active users at the end of 2010, compared to approximately 90.1 million at the
end of 2009. We define an active user as any user who has bid on, bought or listed an item during the preceding
12-month period.
Marketplaces Platforms Overview
Our Marketplaces platforms seek to bring buyers and sellers together through fully automated and
easy-to-use online websites that are generally available throughout the world at any time. The platforms include
software tools and services, some available at no charge and others for a fee, that are intended to allow buyers
and sellers to trade with one another easily and efficiently. The Marketplaces platforms consist of our core online
commerce platform, eBay.com and its localized counterparts, and adjacent platforms consisting of our classifieds
websites, as well as StubHub, Shopping.com, Half.com and Rent.com. Our Marketplaces platforms earn revenue
from listing, feature, final value and subscription fees paid by sellers, lead referral fees, transaction fees, revenue
sharing arrangements and advertising fees, as the case may be.
eBay.com Platform
Our Marketplaces core platform, eBay.com, includes our fixed-price format and our auction-style format
and has localized websites in 38 countries, including those markets in which we have partners or a minority
ownership interest. In 2010, our fixed-price listing format accounted for approximately 60% of our GMV, and
our auction-style format accounted for the remaining 40% of GMV.
Fixed-Price Listing Format
Our fixed-price format allows buyers and sellers to close transactions in the way most shopping occurs: at a
pre-determined price. In this format, sellers can indicate they have multiple items available, including variations
of certain items in applicable categories, such as sizes and colors for clothing, shoes and accessories. Also, sellers
are able to signal that they would be willing to close the transaction at a lower price than advertised through the
“Best Offer” feature. Our Half.com subsidiary also provides a fixed-price online commerce platform that allows
people to buy and sell new and previously owned books, movies, music and video games at discounted prices.
3