Nochex open letter disses eBay and bans

[Bob Crabtree]

To cynics, eBay's take over in 2002 of the PayPal online payment system was only ever going to have one outcome. The real surprise to us is that it's taken so long to become controversial. Now, though, eBay has started to ban the use of online purchasing systems other than PayPal, putting the soft smelly stuff and the air-con on collision course.

Last week, eBay banned the use of Google Checkout - the new e-commerce system introduced by the world's favourite search-engine company. It then followed up a couple of days later with a ban on the long-establish, Leeds-based operator Nochex, which describes itself as, "the UK’s leading independent provider of secure online card payments".

Nochex CEO Martin Greenbank has responded with an open letter dissing eBay and its ban.

Read Martin Greenbank's letter in this HEXUS.headline, then tell us your thoughts on eBay's banning-strategy.

[koocha]

If I could I'd probably remove the Paypal payment option from my auctions, but there are so many people using it I'd probably lose out on a lot of bids.

Tis a shame eBay feels they have to ban the competition. If they lowered their fees I'm sure people would choose to use paypal because of the integration with eBay.

They must make a killing on the fees

[dangel]

Paypal sucks ass I quite liked NoChex!

I wonder if ebay could be considered a monopoly?

[DavidM]

Stand by for the launch of G-Bid... that's all I can say....

[Spud1]

hmm well I am in two minds about this.

One the one hand, this means less choice of payment for buyers, which could ultimately mean less (potential) customers for ebay and ebay traders, especially if traders decide not to accept paypal now.

On the other hand, as a result of there being fewer payment methods the chance of being defrauded could drop (easier to manage fewer payment options), more sellers might accept paypal, and with more focus placed on paypal ebay might be forced to 'fix' the security problems that it currently faces with paypal.

hmm personally I use paypal for 99% of my transactions on ebay (sales and purchases), and have only ever had one problem ( a disputed payment from a customer) which was resolved within a few weeks (I got my money back, he was in the wrong ). So for me, it's not a problem. Nochex I only ever used when I couldnt use paypal (because you could use it at 16 with a debit card), so its not a big loss to me. Others like Fastpay, bidpay etc I never really used..like I say paypal works fine for me

Also I don't think theres anything illegal or morally wrong with this - ebay is a business after all, and they should be able to do what they see fit (within the law) to help their business grow. If this means eliminating the competition then great as far as I'm concerned..I personally think the anti-competition laws are stupid, and Microsoft shouldnt have been fined..but thats another issue

[dangel]

....so you're happy with paypals excessive fees, and their (documented) inability to deal with fraud and protect sellers? What's to stop ebay jacking up paypal fees now they've got an 'exclusive' on their site? None of this can be good for you and I.

[DavidM]

As I said earlier, I can see Google being tempted to launch their own alternative now... and what's the betting they'd allow other payment gateways - to appear as "nice guys" ?

[XA04]

Greedy gits!

[Spud1]

....so you're happy with paypals excessive fees, and their (documented) inability to deal with fraud and protect sellers? What's to stop ebay jacking up paypal fees now they've got an 'exclusive' on their site? None of this can be good for you and I.

The fees are not excessive imho, and i never have to pay them anyway...I sell more than I buy and my buyers pay the fees =) The fraud issue isn't that big either really as no-one with any sense would use an online payment provider for a big sale or purchase...anything over a few hundred quid I would always do in person or via cash/cheque/PO..Plus if your careful common sense will stop the majority of fraudsters, and the ones that you dont spot would probably do you over with any other payment method anyway.

Whats to stop them jacking up fees? Nothing, except that it will drive people away. I wouldnt blame them if they did, it's their business, free to do what they want, if it drives people away then c'est la vie, we can all go to google's version when it launches.

[dangel]

The fees are not excessive imho, and i never have to pay them anyway...I sell more than I buy and my buyers pay the fees =) The fraud issue isn't that big either really as no-one with any sense would use an online payment provider for a big sale or purchase...anything over a few hundred quid I would always do in person or via cash/cheque/PO..Plus if your careful common sense will stop the majority of fraudsters, and the ones that you dont spot would probably do you over with any other payment method anyway.

Well we'll agree to disagree - right now i find that the combined fees of paypal and ebay fairly significant

Whats to stop them jacking up fees? Nothing, except that it will drive people away. I wouldnt blame them if they did, it's their business, free to do what they want, if it drives people away then c'est la vie, we can all go to google's version when it launches.

Drive them away where? When you don't have a choice you'll just have to live with the price rise. Right now there aren't any alternatives - the rest is speculation and vapourware.

[joshwa]

It's blatantly disregarding the anti-competition laws - yet just like microsoft they completley ignore them waiting for the legal system to catch up with them... in the case of microsoft, it's now 2006, and the case against them was to do with windows 98 back in '99 - if it takes then nearly 7 years to finally demand settlement they may as well carry on, because it makes them a huge amount of money in the meantime.

Have MS stopped bundling IE, Media Player and everything else into Windows 2K, XP, Vista? Nope... so what was the point in the lawsuit against them?

[dangel]

MS had to stop bundling media player - not IE - and they did just that in XP 'n' (which nobody wanted or bought).

[Spud1]

joshwa - they do offer a verison of windows without it included(n-edition iirc), however they fact that they *have* to now is ridiculous. Windows is their product, their piece of software, why on earth don't they have the right to do as they please with it? Bundling windows media player etc with it is a great thing to do, giving people immediate functionality out-of-the-box. Sure you can't uninstall it really, but then so what, it's pretty much a part of windows these days...and IE has been integrated properly for years.

I may only be young(21) but the more i learn about the 'real' world the stranger it seems to me, anti-competition law goes way too far..it's the government/EU interfering with private businesses..something that I really don't understand. I can see why they want to, for the good of the economy, but I still find it hard to beleive that they can do it. Anti-competition has a place yes, but not to these lengths. It goes too far.

dangel - there are plenty of other auction sites out there if you dont want to use ebay, or you can go to a real auction, advertise in the paper etc etc, it's not like ebay is the *only* way to sell something. If that were the case then it would be different - but it's not.

[nichomach]

Apparently, Nochex has just been reinstated:
http://www.theregister.co.uk/2006/07...ay_oks_nochex/

[nichomach]

joshwa - they do offer a verison of windows without it included(n-edition iirc), however they fact that they *have* to now is ridiculous. Windows is their product, their piece of software, why on earth don't they have the right to do as they please with it?

That depends upon whether you think that a company with a functional monopoly on the desktop operating system market should be able to leverage that to indulge in product tying and to freeze out competitors from competing effectively, not on the basis of technical merits, but purely on the basis that the monopoly holder's product is already there.

Bundling windows media player etc with it is a great thing to do, giving people immediate functionality out-of-the-box. Sure you can't uninstall it really, but then so what, it's pretty much a part of windows these days...and IE has been integrated properly for years.

In both cases, WMP and IE, they are only so tightly integrated into Windows because Microsoft has decided that they should be, hence the difficulties involved in attempting to remove either. They could distribute either freely, make them available as free downloads or whatever, but it's THEIR choice to render these applications virtually irremovable, and it's a choice that they made not for any reason of functionality, but purely to sidestep the laws against product tying and bundling - after all, if they are an integral part of Windows, then they can't be a separate tied or bundled product, can they?

The integration was there purely to extend their monopoly from the desktop OS into the browser space and into the media content delivery space. Yes, you could still download another media player and an alternative browser, but WMP and IE are already there, which is a crucial advantage in market penetration, and they are also impossible to ditch.

For instance, I use Firefox as a browser by choice (though Opera 9 looks mighty tasty). I barely use IE at work and almost never at home. However, due to IE having been delibarately woven into Windows, every IE bug affects every Windows install, and the same with WMP bugs, so I effectively have to download megs and megs of fixes for a product that I don't like and don't use, because MS have decided as a purely commercial decision to make them impossible to separate from Windows. That's a good thing?

Remember the early days of the browser wars? When Netscape was the best browser out there by a country mile, and all you could rely on IE for was an interesting variety of error messages? MS bundled IE free and people used it, not because it was better, but because it was there. Now a free browser is a good thing, and Netscape soon followed suit, but they were never able to compete effectively because MS had bundled IE with every copy of Windows, leveraging the OS monopoly to promote their own product and freeze out competition. They were found guilty of violating US antitrust laws, but the process was so protracted that it was a pyrrhic victory for Netscape, whose core browser business had long since collapsed. It was in response to this that MS took a strategic decision to integrate the apps that they wanted to gain market share with so closely into the OS that they'd be immune from allegations of tying or bundling.

I may only be young(21) but the more i learn about the 'real' world the stranger it seems to me, anti-competition law goes way too far..it's the government/EU interfering with private businesses..something that I really don't understand. I can see why they want to, for the good of the economy, but I still find it hard to beleive that they can do it. Anti-competition has a place yes, but not to these lengths. It goes too far.

Actually, no it doesn't, it just doesn't move fast enough to keep up with the delibarately infringing conduct of Microsoft.

The point of a market is that there should be competition; that companies should have to keep trying to innovate and improve their products. An unrestrained monopoly runs counter to that objective since it doesn't compete on innovation or efficiency, but by using its dominant market position to freeze out competition that may be more innovative or more efficient, but is denied entry to the market by the monopoly.

[Spud1]

I would definitely argue that IE is a part of windows and not a separate product. It's a part of the product that you buy, and without it windows XP for example would not function - and neither will many many third party products, specifically anything that relys on the IE activeX control to process/interpret HTML, or any of the many other controls that require you to have IE.

If Microsoft prevented you from installing iTunes, Firefox, netscape etc then of course thats a different story - but simply bundling something with windows isn't anti competitive at all in my view. Competitors can still market their products, people can and will buy their products...

Also - why havn't apple been sued over this yet? They bundle Safari Quicktime and iTunes with OSX, and quicktime in particular is heavily integrated into the OS - yet they are not accused of being anti competitive?

This is all just my opionion of course, but I think its totally wrong to dictate what they can and can't do with their product just because it's popular. The law may disagree with me, but then the law and I disagree on alot of things