What is going on at eBay?

The controversial new feedback policy from eBay removes sellers' ability to leave neutral or negative feedback for their buyers.

EBay hopes the change will benefit both buyers and sellers by creating a more reliable marketplace, some small merchants see this as another reason to move their wares elsewhere.

Sellers are taking more drastic action: A number have posted store notices saying they will no longer leave any feedback at all in protest of eBay's new policy.

EBay officials say the feedback change was necessary to counter a growing trend of sellers leaving retaliatory ratings for buyers who give them negative ratings. Wouldn't you?

"What we discovered through research was that any negative feedback that the buyer gets reduces their purchasing or willingness to purchase within the marketplace," said Brian Burke, eBay's director of global feedback policy. "The goal behind the changes is really to make sure that we've got buyer accountability and seller accountability."

To make up for limiting public feedback options for sellers, eBay is giving its sellers more tools to protect themselves against unscrupulous buyers. Starting May 27, vendors will be able to tighten buyer restrictions and block shoppers who have been reported for policy violations, such as feedback extortion or nonpayment, from buying or bidding on their items.


EBay's feedback change is part of a comprehensive revamp that has also brought changes to eBay's fee structure, search algorithm, and PayPal policies. Small merchants have been particularly vocal in their displeasure about the changes.

"I think we're in a very hostile seller situation," one merchant said. "I have no clue why eBay is doing it, but it scares me."

There is a seller's budding backlash, punctuated by eBay-bashing Web sites and online message groups. According to USA Today, Smaller auction sites Bidville, ePier.com and iOffer.com, among others, report an increase in new users. Wagglepop.com says 2,700 sellers, most of them eBay defectors, have lined up to join when it starts later this month. "We struck a nerve at the right time," says CEO Ray Romeo, a former eBay user.

About 430,000 individuals and small businesses make part or all of their income from listings on eBay — nearly three times the number in late 2002.