EBay Corporation - Research Paper Example

Additionally, the robust economic performance and the potential of the company makes it attractive. The company makes revenue through a multifaceted system of charges for services, listing merchandise features, and a final value charges for sales profits by sellers. The U.S. centered eBay charges from $0.1 to 2 dollars as from 2012 November based on the reserve or opening price, as an assertion charge for a simple auction-style listing devoid of any adornments. The final charge sums up to 10% of the overall amount of the auction, which is the charge of the product plus transport charges (Marketwatch: Technology, 35).

Additionally, eBay possesses the PayPal payment system that has charges of its own. This PayPal platform enables buyer protection as it protects the cash one spends if an individual does not receive the products ordered or he or she receives the wrong products, then this platforms allows one to get his or her cash back. Furthermore, the company is still sitting attractively. According to (Hasker and Sickles, 33), eBay booked over 15 billion dollars in the year 2002, far obscuring Amazon’s 4 billion dollars.

Its stock although not unaffected by the dot-com crash, it has not been destroyed like numerous other high-flying concerns. Actually, eBay enjoys a marketplace capitalization of $24 billion, and recently its stocks extended to 52 weeks while still high. Most significantly, eBay’s business model has confirmed its worth and carried on to flourish even as the company’s management discovers new avenues. The first-mover benefit allowed eBay to take over the online sale space. The alleged network effect has bred an acute mass of consumers, a group distributed to sellers and buyers.

Moreover, its vanquished competition makes eBay more attractive as the company has benefited from on the network effect of a larger magnitude than any other e-commerce business. The fact that its critical amount of consumers establishes an ever-expanding scope of influence similar to a magnetic field.