eBay: It Ain’t Rocket Science

My wife is a power seller on eBay but lately not so much, in fact she’s even been getting phone calls from eBay asking why. She continues to express amazement that they don’t seem to get the message.

eBay’s (EBAY) core business continues to fall apart. Some of the decline is likely the result of the declining economy. The rest of it is likely the result of the trends that have been clobbering eBay for the past two years: competition, overpricing, and the deterioration of eBay’s value proposition. eBay’s efforts to turn around this business do not appear to be working.

[From eBay Traffic Plummeting (EBAY)]

Memo to eBay: you screwed up when you raised seller fees, started “nickle and diming”, and nobody, I mean nobody, is happy with PayPal. Traffic has dropped in each month of 2008, except for March, and coincides with the timing of the fee structure changes.

If there is one business that should do well in a recession, I would think eBay should be it.

Blockbuster Decides Online is the Future After All

First they said they wouldn’t be rushed to market with a download service, but it turns out Blockbuster was rushing after all. You have to buy the set top box and then $2-4.00 a movie, and their is a requirement you start the movie within 30 days then then finish it in 24 hours. BTW, this mimics iTunes terms but I would not point to iTunes as a smashing success when it comes to movie downloads either, and Apple TV has not been Apple’s most shining moment either.

Blockbuster is the first major customer to deploy the MediaPoint digital media player from San Jose’s 2Wire. The service will give the video retailer a chance to compete in the growing video-on-demand market against companies like Vudu and Apple. Unlike Netflix’s deals to bring movies to TiVo boxes, DVD players and the Xbox 360, Blockbuster will not be a subscription model. Users will pay $99 for the MediaPoint box, which will include 25 movie downloads. After that, movie downloads will be as little as $1.99 for standard-definition rentals.

[From Blockbuster bringing movies into the TV]

Basically they are subsidizing the set top box with 25 free downloads, which could be worth $50-100 depending on what movies you download. It’ll be interesting to watch how this plays out considering Blockbuster’s well publicized fiasco with unlimited rental times which actually were limited for DVDs the last time they tried to compete head on with Netflix.

It’s clear that nobody has nailed the movie download service model yet. Amazon’s service has been a non-event, Netflix is probably the furthest along in terms of adoption and their Tivo announcement certainly boosts them, Apple is lagging here when compared to their other segments, and this Blockbuster announcement is a little too little to get excited about.