Archive for the ‘Essays’ Category
Computing Without Walls: Open vs. Closed Source
Posted by Benjamin J. Thompson | Filed under Essays, Linux, Technology
In an earlier post I referred to Windows as a ball and chain, largely because there seems to always be some little thing here or there that I can only do via Windows, and so I can never completely leave it behind on my PC(s). There’s a reason I blame this inconvenience on Windows and proprietary software rather than the free stuff.
The reason is this: those who exploit the copyright and patent system stifle ideas that have every right to spread. Ideas only have a future if they are shared. That goes for software just as well as it does for philosophy and music. Open-source software licenses don’t impose restrictions on others’ use of ideas and code, but closed-source ones do.
I’m done selling on eBay. I don’t need the drama.
Posted by Benjamin J. Thompson | Filed under Essays, Literature, Thoughts
Unless you’re cleaning out your basement, in a hurry to unload your autographed whatchamacallit, or have a high-margin or specialty product that lends itself to the auction format, my advice is to avoid eBay. As a market, it’s expensive, overrun with competition from drop-shippers and small retailers, and your customers will have you over a barrel if they even imagine you made a mistake.
Why should you listen to me?
I speak from experience. I’ve sold thousands of items on eBay, both personally and professionally, with a total in sales in the hundreds of thousands of dollars. There are a few things I’ve come to understand about this marketplace in the years since I created my first account there in September of 2000. For the record, my own personal account is currently a Top Rated Seller, with all-time 100% positive feedback rating, and a Power Seller. I believe this status is about to disappear since I quit selling there.
eBay: The good times
When eBay first appeared, one of the revolutionary features it offered was a feedback system by which buyers and sellers could gauge each other’s reputations. You could read a seller’s feedback, and if you were smart, you would take a look at the feedback history of those who had left them negatives, as well. This was a brilliant system. It rewarded discerning users with a better experience, and punished rude users with frustration and ostracism.
No one wants a black mark on their reputation. This created an incentive to both sides to seek some kind of resolution before resorting to negative remarks. The beauty of this system is that it complies with economic reality: all transactions have two sides, both of them human, and both of them with equal rights not to be abused.
eBay: Tilting in favor of buyers at the risk of losing sellers
In May 2008, sellers lost the ability to leave negative feedback on bad buyers. This eliminated a key dynamic to gauging whether or not a buyer or seller was reputable. eBay claimed the reason for this change was, according to Bill Cobb:
…that buyers are more afraid than ever to leave honest, accurate feedback because of the threat of retaliation. In fact, when buyers have a bad experience on eBay, the final straw for many of them is getting a negative feedback, especially of a retaliatory nature. [emphasis mine]
Now, we realize that feedback has been a two-way street, but our data shows a disturbing trend, which is that sellers leave retaliatory feedback eight times more frequently than buyers do … and this figure is up dramatically from only a few years ago.
From that point on, only sellers could be rated negatively. This tipped the market drastically in favor of the buyers, and needlessly antagonized many sellers. Don’t get me wrong; the free market is automatically tilted in favor of the consumer at all times. Whenever it isn’t, that’s evidence of some very unfair intervention from an unjust third party. That’s just its natural tendency.
I’ve observed two things under the new regime. eBay has succeeded in removing some of the fear in buying on eBay. They have also given buyers room to be downright belligerent. I have seen too many buyers in the last year resort immediately to threats the moment they detect a problem with their purchase. In the old environment of mutual feedback, such automatic vitriol was discouraged.
I don’t doubt for a second they’ve increased buyer traffic to the site. I also suspect eBay will continue to lose prestige as an online marketplace. Cobb laments that some buyers leave eBay because they receive one bit of negative feedback.
What about the sellers who do that?
After nursing a perfect feedback score for nine years, I left eBay because of one negative feedback. I got the buyer to reverse it because it was a misunderstanding, but I realized then just how easy it was for a single buyer to damage my margin, my reputation, and on top of it all, waste my time, over something that wasn’t even a problem to begin with.
Negative feedback is inevitable for sellers, but not inevitable for buyers
As a buyer, it’s easy to get positive feedback. Pay for the item on time.
As a seller, it’s much harder. In any item description, there is going to be some term or phrase someone finds ambiguous. The Internet is filled with people with bad tempers, short fuses or unrealistic expectations. Some of them win auctions. The Web’s veil of anonymity doesn’t help matters. This is a medium where it’s easier than ever to view the other person as some kind of unthinking goblin. The old feedback system at least humanized both sides because the risk of bad feedback was mutual.
Sellers with any kind of volume are going to run into these rage-prone outliers, and are now completely defenseless against them. Once he pays for the merchandise, the buyer is completely immune. He has the seller completely at his mercy, no matter what he misunderstands, misinterprets or wrongly assumes. Should the buyer choose to vandalize the seller’s feedback rating, the seller’s only recourse is the dim possibility that an appeal to eBay might undo the damage.
In Cobb’s January 2008 letter, he said “sellers leave retaliatory feedback eight times more frequently than buyers do.” I want to call attention to the fact that calling a line of feedback “retaliatory” is a value judgment. Based on your metric for calling feedback “retaliatory”, Bill Cobb’s number could have been just about anything. I’m not privy to eBay’s data or methodology on that one, and I don’t doubt they’re doing their best to be accurate, but this principle is still true.
“Retaliatory” feedback isn’t always a bad thing
If “retaliatory” is defined as leaving bad feedback in response to bad feedback, this is not in and of itself a bad thing. What it could mean is that a higher proportion of bad feedback left by buyers is pure nonsense that must be righted by a response. The higher likelihood is no surprise. Feedback integrity is far more important to the seller than to the buyer, so sellers would naturally be more defensive.
“Retaliatory feedback” is perhaps a bad thing for eBay if the number of people capable of handling online commerce with maturity is too small for their traffic hopes, but it isn’t necessarily a bad thing for the health of the market.
Conclusion
As a company, eBay’s success is dependent on the success of the sellers. They know this. eBay collects its fees exclusively from sellers. They have a difficult job: the consumer eBay must satisfy to stay in business is the eBay seller, yet those very sellers depend on their buyers. For the best results, eBay’s managers have to figure out how to best satisfy two groups whose self-interests are often opposed. I don’t envy their position. Maybe I’m completely off-base and they have done the right thing, but the eBay stock price has so far not regained the high it was at the month before this policy went into effect. I suspect eBay is over-thinking their problems. The fee and rule system has become a bloated morass of variables that could change at any moment, and often do.
No wonder sellers are switching to the stable, predictable world of selling on Amazon, and the much more civil Etsy experience.
This seller at least is through with eBay. I just don’t need the drama.
Currently Reading Roundup
Posted by Benjamin J. Thompson | Filed under Economics, Essays, Fiction, Liberty, Literature
At the moment I am working my way through the following books:
- End the Fed by Ron Paul
- A Fire Upon the Deep by Vernor Vinge (this is my second read through)
- Socialism by Ludwig von Mises
End the Fed
It may just be the fact that I am a ravenous reader of LewRockwell.com and Mises.org, but End the Fed is by far the quickest, easiest read out of the three at the moment. Ron Paul was never a stunning public speaker, but his writing — or what becomes of his writing when his editor(s) get through with it — is concise, incisive and accessible. Amazon.com was gracious enough to send the book early, and in spite of not cracking it open for several days, I’m most of the way through it. He starts by making the case for why the issue of monetary policy is so important, then walks the reader through his own intellectual journey, his experience of history so far, and his confrontations with past chairmen of the Federal Reserve. Further on, he makes several cases as to why a 100% reserve, hard money standard is vastly superior to what we have now.
A Fire Upon the Deep
I read this book years ago while still lazily studying computer science at UW Whitewater. I recently read the prequel (A Deepness in the Sky), which is in part a brilliant parable of liberty versus tyranny. Knowing a little more of Vinge’s political philosophy drove me to re-read this book, since I picked up so few of those hints the first time around.
Just as in A Deepness in the Sky, Vinge takes for granted at every turn that the reader is curious and observant. I’d been reading so much economic commentary, and so much fluffier fiction in the Harry Potter books recently that Vinge was an intellectually challenging change of pace. It felt like the first day resuming an exercise regimen after a long hiatus.
Socialism
Precipitated by all the political tension around that word, socialism, these days, I decided I should read the book known as the ultimate refutation of every fallacy that feeds into the socialist theory. It is translated from German, and the man was notorious for his unique turns of phrase, even after translation. Reading Mises is a bit like seeing the same old room, but illuminated from the bottom. The light is coming at things from an unfamiliar angle, revealing obvious things you never saw before.
Anyway, that’s what I’m up to reading right now. I highly recommend all these books, but please start with End the Fed. Whether you know it or not, it is at the root of every political issue today. The arguments might be about jobs or health care or bailouts or wars, but we will be facing the same problems over and over again until we confront central banking, for it is loose monetary policy that makes possible all the evils that bad politicians waste money on.