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The Perfect Store

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Gambling on Goodwill

From: Andrew Chignell
To: David Goldberg and Andrew RosenblumPosted Wednesday, Aug. 21, 2002, at 11:03 AM ET

This week's reading

Who are these people?

Buy the book

David, bracing as it was to receive an e-slap and then a *hug* in the course of reading your last post, I think I'll stick to my guns about the bodily nature of authentic community. Surely you can't think that what the three of us (and the members of "The Fray") have been doing this week is communing? Much as I've enjoyed it, most days I'd prefer a corporeal picnic on the beach.

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But as you, Andrew R., suggest, temperament and even nationality may have something to do with such preferences. (In the latter connection, I took an unscientific survey of the major foreign eBays and found that, believe it or not, the French are even less chatty about their auctions than the British. Last night, eBay France's main forum board enjoyed an anemic average of four posts per hour, whereas the Brits [and the Germans] were yammering away.)

In any case, let me note that I was not making the uncharitable suggestion that all Internet chatters are "abnormal and unsociable." The claim was rather that the hard-core early eBayers—the Uncle Griff types—who spent long hours rubbing virtual elbows in the "eBay Cafe" may have been teetering on the edge. Cohen points out that it was the "network effect" of having these serious users in place that allowed eBay to squelch early competitors (that's why there's still no Pepsi to eBay's Coke). I think it was a wee bit disingenuous for Omidyar and Co. to enable this behavior, make billions hand over fist from it, and then saccharinely liken the whole thing to a "community" (or, as Cohen laughably does, to "a religion or a social movement").

You'll be happy to hear that Rosie O'Donnell was wrong: My copy of The Perfect Store did sell on eBay yesterday … for a meager $9 (perhaps I should have offered to throw in some used BVDs). I'm not sure what conclusions we should draw from this, but here are some that come to mind:

1) Rosie is not to be trusted.

2) Our discussion here (sigh) didn't exactly trigger a run on the market for Cohen's book.

3) Talk of a "perfect market" or a "perfect price" is vacuous (remember, the average price for a used copy elsewhere is around $17). The price one gets is, as you both intimated, usually just a function of who happens to be looking and how rabid they are about winning.

One thing we haven't touched on yet is the issue of fraud. It's hard to find any firm numbers on this, but Cohen reports that, of all the transactions on eBay, only a "small fraction of a percent" are bogus. Management explains this, optimistically, by appealing to their first community value: "We believe people are basically good." Of course, the Feedback Forum also helps—if a seller is publicly flayed he will have a tough time finding future buyers.

Although Cohen does mention some of the most infamous shysters (e.g., the "art" dealers who used shill bidding to cheat people out of $450,000), I found my vaguely Hobbesian suspicions about human nature challenged by the fact that—even before the Feedback Forum was introduced—most transactions were aboveboard. If you were two of the early venture capitalists invited to invest in eBay, would you have gambled on people's goodwill? I'm not sure I would have—and that, of course, would have been a colossal mistake.

I'll sign off by noting, in a Hobbesian spirit, that though our time together has been anything but nasty and brutish, it certainly has been all too short.

Best wishes to you both,
Andrew C.