Nochex open letter disses eBay and bans

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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.

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

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

Paypal sucks ass :( I quite liked NoChex!

I wonder if ebay could be considered a monopoly?

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

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 :)

....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.

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" ?

Greedy gits!

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Originally Posted by 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.

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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.

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Originally Posted by Spud1

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.

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

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Originally Posted by Spud1

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.

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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.

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?

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

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.

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

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Originally Posted by 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?

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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.

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Originally Posted by Spud1

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.

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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.

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Originally Posted by Spud1

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.

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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.

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 :)

OK, last point first; can you tell the difference between a company with 95% market share and one with 5%? Well, that's the difference between a company that has a monopoly and one that doesn't.

IE is now an inseparable part of Windows because that's what MS decided to make it, and that had nothing to do with functionality. ActiveX has nothing to do with processing HTML; it's an engine for processing executable code, like the Java virtual machine. That's a minor point, however - yes it's impossible to get rid of IE, but that's not because IE does anything for Windows that couldn't have been done another way, and perhaps better; it's because MS wanted to make the argument in court that IE was an integral part of Windows, and therefore could not be stripped out without breaking Windows. Same with Media Player, although the EC have quite rightly stuck two fingers up at that.

Bundling and tying ARE anticompetitive when you're a monopoly player; it denies other companies equal access to the market. When you plug in your shiny new Dell, you have IE installed which takes you to MSN, where you can find stuff to play in Windows Media format on Windows Media Player...and you don't think that freezes competitor products out from the start? Sure, you can download alternatives, but you are less likely to by a long way, and you can't get rid of the stuff that MS decided to integrate. That's anticompetitive.

Look at it this way; say you don't like IE and WMP. You think they are insecure, so you want to use alternatives. You download Firefox, and maybe start using Realplayer or something. Now you don't have to worry about IE and WMP security anymore, right? Wrong, because purely to secure a commercial advantage MS have decreed that both must be so tightly woven into Windows that you'll still have the same vulns and still have to download the same patches even though you never want to use the damned applications.

Ok we are going to have to agree to disagree here I think :)

Apple have a monopoly on running OS's on their hardware don't they? Using the above logic, if you buy a mac you get OSX on it. Sure you can run linux on it if you want, but almost everyone will stick with OSX, yes? [NB talking about PPC based macs here, x86 is a different kettle of fish]

Just because they are smaller they are exempt? hmm ok I can accept that if you view apple as being in the same market as windows that this could be true, although surely anti-competitive practices don't rely on how big your company is.

With respect to the activeX thing - I wasn't talking about activeX in general, I was specifically talking about a component of it that requires IE to be installed, and is used extensivly in many 3rd party applications (I have used it myself recently). I don't think that Microsoft deliberately integrated IE in windows purely to stop competitors - it simply makes logical sense. If you have some code that can deal with multiple things, why not re-use it elsewhere in the system? It may not be the best thing for the job, but if it works, and keeps development costs down then of course they will do it.

It's a fair point about when you buy, say a dell and what you explained happens, but that doesnt mean microsoft should stop bundling WMP and MSN with windows, just that it shouldnt be automatically set up to do such things..

But like I say we will have to agree to disagree here :)

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Originally Posted by nichomach

Bundling and tying ARE anticompetitive when you're a monopoly player; it denies other companies equal access to the market. When you plug in your shiny new Dell, you have IE installed which takes you to MSN, where you can find stuff to play in Windows Media format on Windows Media Player...and you don't think that freezes competitor products out from the start? Sure, you can download alternatives, but you are less likely to by a long way, and you can't get rid of the stuff that MS decided to integrate. That's anticompetitive.

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Very true, but in fairness, is Johnny No-Experience going to appreciate that simple streamlined start, or having to venture out and find software he doesn't have a clue how to use, or indeed, how to get hold of? We have to remember that Microsoft is after all selling a product, and they can't keep giving up their real-estate to give other companies the chance of invading their territory. Although as a primarily enthusiasts forum, most of us know what we like to use and how to do it, the majority of users do not, and rely on what's easily available to them; having such features/programs available from the start is useful to them.

Personally, I think with Vista's psuedo-compartmentalisation of what were previously 'key' components of windows, the option to install WMP etc during installation (and not with such tools as nLite) would appease many parties. I for one, as a user of an open source media player, would appreciate the ability to remove Windows Media Player from the start in a simple fashion, thus allowing me to install WMP Alternative or similar software. In doing this, the more experienced users with their own preferences can pick and choose as they wish, whilst new computer users and inexperienced users can have the features they want available from the start.

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Originally Posted by nichomach

IE is now an inseparable part of Windows because that's what MS decided to make it, and that had nothing to do with functionality. ActiveX has nothing to do with processing HTML; it's an engine for processing executable code, like the Java virtual machine.

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Not entirely true - it's used throughout explorer itself (the shell) for example and in itself is embeddable which can be quite useful to us poor devs. The problem is, MS want to leverage _functionality_ that a embedded browser provides (which is understandable) and people expect a browser of some sort to be there when they install the OS. I agree that choice is a good thing but I do wonder whether the end-user would of better been served by offering choices at the purchase point - i.e. someone like Dell - where it would of made more of a difference. Interestingly, you can strip IE from windows quite easily, it's just that then certain things stop working - i've got a stripped out install of XP that sits on 50mb post boot; it's pretty dull looking but it (mostly) works. Can't use windows update tho... and surfing the web to download another browser is er.. impossible :)

ActiveX and Java live in different worlds - an activeX control is just a COM component with an IDispatch interface (I assumed you'd meant this in the context of talking about IE) - it's native code. Java isn't (AFAIK) and is far more analogous to .NET in that no executable code exists, rather it's converted to executable code in real time by the virtual machine.

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Originally Posted by Xaneden

Personally, I think with Vista's psuedo-compartmentalisation of what were previously 'key' components of windows, the option to install WMP etc during installation (and not with such tools as nLite) would appease many parties. I for one, as a user of an open source media player, would appreciate the ability to remove Windows Media Player from the start in a simple fashion, thus allowing me to install WMP Alternative or similar software. In doing this, the more experienced users with their own preferences can pick and choose as they wish, whilst new computer users and inexperienced users can have the features they want available from the start.

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I like this approach - but I would caution that 99% of people would just install everything regardless and live with it (unless it's really bad or there's enough press [rare] about the alternatives) particularly with IE7 shaping up to be more than good enough compared to firefox.. I want to hate IE7 but it's pretty good really - and i'm an Opera user..

All a bit odd, to me, but that's the story (as nichomach already pointed out earlier in the day - and I missed!).

Check it out.