Monday, January 23, 2006

eBay U-turn as China Internet market reports 2005 numbers

Just before Christmas, we noted that eBay was beginning to wilt before the onslaught of's auction site invigorated by all that Yahoo! money. Now, numerous sources, including the FT, have reported that eBay plans to drop all transaction fees.

As the article points out, this will require some back-pedalling from the previous position that the company has taken that "Free is not a business model". I have some sympathy with that view but, at the bottom end of the barrel in the China market which is where and eBay both sit, numbers are what counts above all else at this stage.

And, talking of numbers, we see that the latest reports on China's Internet market show 18% growth in total users to 111 million. Given the scale of the numbers, this remarkably represents an acceleration of user growth. 2004 reported 16% growth. Even more remarkable - and think of the business opportunities this represents - over half of all those Chinese Internet users - 64 million - have access via Broadband.

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