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Monday, June 27, 2005

eBay ProStores

Eager to find new sources of income beyond its popular online auction format, eBay Inc. has launched a service that encourages small and medium-size sellers to build Web stores that operate independently of the e-commerce powerhouse.

eBay's new ProStores service will allow sellers to design their own fixed-price e-commerce site with a unique Web address. There are four tiers of ProStores, with monthly subscription fees ranging from $6.95 to $249.95

A basic subscription costs $6.95 per month with fees ranging from 0.5 percent to 1.5 percent of transactions and will allow users to link their custom-built site to their eBay site and use PayPal, eBay's popular online transaction service.

The move, which eBay announced at its annual shareholder meeting Thursday in San Jose, Calif., comes as revenue growth slows in the company's core auction format.

The new service comes about six months after eBay enraged many small-scale sellers with a hefty price hike. In mid-January, eBay warned sellers in a terse e-mail that the monthly subscription fee for people who operate "Basic eBay Stores" would increase from $9.95 to $15.95, and the fee for a standard listing of 10 days would double, from 20 cents to 40 cents.

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