The eBay Effect: Inside a Worldwide Obsession

Cynthia Fuchs

As host David Faber says, 'If you're not listening to the Community, they can become downright un-neighborly.'

The Ebay Effect

Airtime: Wednesday, 8pm ET
Cast: David Faber
Subtitle: Inside a Worldwide Obsession
Network: CNBC

The slick, seemingly unstoppable corporate wonder called eBay is more convoluted than it looks. No surprise: most of the complications have to do with numbers. According to CNBC's documentary The eBay Effect: Inside a Worldwide Obsession, the business that's all about "the people" is now nearly 10 years old, employs 9,000 workers, serves 135 million customers, and is currently looking at a year where 1.8 billion items offered for sale are expected to produce $4.2 billion in fees.

Host David Faber introduces the eBay story by granting CEO Meg Whitman the chance to frame the case. "What is eBay?" he asks, apparently innocently. She's got the rote answer ready: "It's the first global online marketplace that connects buyers and sellers 24 by seven across the globe, and has fundamentally changed the way people think about trade." The fact that it's made some few people very rich while leaving others frustrated and without recourse (say, the folks who send checks for merchandise that never comes or arrives in very different condition than promised) is only part of that fundamental change. Or maybe it's just more of the same.

The documentary takes eBay at its word, to a point, anyway, introducing the "personal effect" by way of Faber's own experience auctioning an item -- his framed collection of tickets from that 1998 season when Mark McGwire made his home run record. Yes, the whole steroids scandal will cut into the value, but Faber goes through the process and puts it up for sale. Though it doesn't generate much interest by documentary's end, at least you'll be familiar with the links and clicks and recorded voice directions that frame the eBay seller's experience.

And that would be a first entrance into what the eBay mucky mucks like to call "the Community." Yes, once you've entered even a smidgen of information with eBay, it remains somewhere in their gigantor storage system (visualized here as a throbbing mass of machinery behind Network Operations Center chief Tom Keeven, as Faber describes it as "the place where eBay is always watching"). As well, says Steve Grove, head Product Marketing, the company keeps track of "path flows and see immediately where people are having 'issues.'" Really, all this tracking and monitoring is only because the company wants to serve you better, to move your transactions faster, to help you make money. And to that end, the Voices Program, or "the mother of all focus groups," invites members of the Community to commune some 10 times a year. For two days each time "I can be on anywhere from 8 to 12 hours a day"), chat, and offer suggestions -- sometimes even to CEO Whitman, shown here at a cafeteria style meal, nodding as if she's listening to the lady next to her.

Indeed, says Faber, "If you're not listening to the Community, they can become downright un-neighborly," at which point the documentary runs through some montagey headlines: "Trial over threats to eBay officials set to open" and "Online auction scams soar." (When tv anchor footage appears, the images are NBC guys -- Brokaw, Lauer, which only highlights the idea that corporate synergies are limited, despite their claims to global reaches.) EBay maintains as well the right to remove items it deems immoral, like "date arrangements," breast milk, Nazi paraphernalia, and guns. "I'm kind of uncomfortable with the idea of people renting out their kids on eBay," says one exec.

But even as the film introduces (potential) problems, you don't get the feeling that the upper echelon suits give them too much thought. "We can better," says Whitman, in a general sort of way. But really, she protests, the company does so many things right. To frame the contradictions -- somewhat -- the documentary provides a bit of history, more or less dispelling the "myth" that founder Pierre Omidyar dreamed it up as a way to sell off (or is it augment?) his wife's Pez dispenser collection. Rather, Omidyar says, he was inspired by "the passion that people have for collectibles" to use the net to "bring power to the people." As he discovered that these people were not prone to trust one another, and that they were prone to complain -- to him, as head of the company -- he developed more software that allowed users to post complaints publicly, on the Feedback Forum, thus making known culprits and rewarding well-behaved sellers.

Devotees of the site have all kinds of stories to tell, most of them dealing in large numbers -- meet the millionaire "high grade" comic books vendor who claims he likes to steal away from business meetings to do some buying on eBay, to "get my brain clear," by "jump[ing] into eBay for a bit. The mind works in funny ways and it needs its exercise too." This exercise has cost him some $5 million on collectibles, and he's apparently just delighted about it -- this guy smiles more than anyone else in the film.

Other satisfied users are sellers -- a couple who has developed a DVD sales company through eBay that makes them some $800,000 a year, the wife of a sergeant in Iraq, whose appearance is accompanied by a military drum roll. As she describes her entry and immersion into eBay, she attributes her success to the fact of her marriage: "It's the neatest thing,'" she says, to "have something listed and see people bid against each other." Moreover, it's "really neat to see how many people are out there to support our men and women." And still another woman extols the way that eBay has allowed her to feel empowered since the work-related accident that left her in a wheelchair. She's since found a sub-Community of disabled folks who do business and form friendships through eBay.

Along with these happy stories, though, the documentary keeps up a steady push of less pleasant goings-on, especially concerning disgruntlement over rising fees (both eBay and PayPal make money off of every transaction), as well as the potential for fraud, even amid the seeming confidence between sellers and buyers, and the all-important public defrocking of scoundrels. Though Whitman insists that "We want the bad guys and the community to know that we're watching and will catch you," at least in part because the company has 1000 employees around the world whose job is "to be watching the site 24 hours a day," scam artists still get through, and buyers are still fooled, with little in the way of insurance against loss. "It's an art," smiles Whitman, "not a science."

Still, The eBay Effect suggests that much of such corporate speak is just that, public relations patter for workers and stockholders. The company is always "looking better," or "looking forward." The film suggests that looking in at itself wouldn't be a bad idea, either.

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