Shares of leading auction site eBay (Nasdaq: EBAY) tumbled more than seven percent, falling 10-3/4 to 141 on Friday after the news that a consortium of technology heavyweights are teaming up on a new auction service. Companies including Microsoft, Dell, Lycos, [email protected], Xoom.com and Ticketmaster-Citysearch are now part of a network of more than 100 auction sites that will share listings.
The new auction network, created by Fairmarket, is expected to be launched today. Before investors get overly concerned about the future of eBay, it should be worth noting that the auction services of Amazon.com and Yahoo! haven’t even come close to toppling eBay. That’s because eBay has the best brand awareness, the most loyal customers (even after recent outages) and the most listings of any auction site. EBay currently has more than 2.5 million listings on its site. Fairmarket is expected to launch with about 70,000.