eBay losing its ‘magic’

Has the shine come off online auctions? eBay chief Meg Whitman has acknowledged that the site has lots some of its “magic”, as the balance tilts away from home sellers to professional retailers. Not that eBay is grumbling too much. The company reported profits of $310m on turnover of $1.4bn for 2Q 2006 yesterday. eBay also has $4bn cash in the bank. $9bn worth of trading went on under its roof in the period.

I am unsure how they figure that eBay is losing it’s ‘magic’ when it had a 20% gain in users and 35% increase in listings over the past year. If there is indeed any ‘magic’ being lost here, it’s likely due to PayPals high rates. That’s just my speculation though.