"We WANT to Protect You..."

Imagine this, if you will...

Your daughter and yourself own and operate a small jewelry repair and gift shop in an old brick building on a busy old street.  Most of the business have been there for decades.  There's the deli and coffee shop, and the used book and curio shop, and the pharmacy, and the motorcycle repair and accessory shop, and the sporting goods store, and the small bank branch on the corner.  The town has a bustling core of tourist traffic that supplies ample amount of financial support.  This tourist business is solid but does cause a few issues with fraudulent credit cards and so forth.  The merchants do what they can but accept this as a typical danger of being in business.

You notice one day, some merchants are installing these new loss-prevention machines that really seem to be stopping all credit card fraud.  Unfortunately they are hesitant to discuss the details and are somewhat unhappy, saying foot traffic is down significantly even though the number of tourists in town is increasing.

One day a couple of fellows come into your store and offer this new system to you.  They offer to place a detector and door lock on your front door free of charge.  All they ask is that all purchase transactions you make go through them, 'for security purposes.'  They will hold all money for three days in their bank account for transaction validation, then release the funds to your bank account.

Here's the big catch...  only people who have registered with their service can enter your store.  Sure, they can look in your window, and if they ask, you can let them in if they haven't registered, but they don't recommend it.

"Everyone else on your street are using our system and LOVE it!  No one has had a fraudulent purchase since our systems have been installed," they say.  You tell them you will think about it.  They give you their card and leave.

One month later you are balancing your books and realize fraud is up by 20%!  Generally foot traffic and cash flow has increased but not enough to cover the new fraud.  You call the two fellows selling the anti-fraud solution and have it installed.

That's what seems to be happening to E-Bay.  Buyers can look at the items but unless they are PayPal users with validated accounts or addresses or whatever, they can't even put a bid on items.  You aren't a PayPal customer, you are shit-outta-luck.

That's how it works...  There's fraud happening so E-Bay offers this great service to a few merchants.  It's a little shady and locks the buyer base but it works.  As more and more merchants use this service, fraud becomes focused on those merchants who don't use it.  So, those merchants are pressured into using the service for 'protection'.

Here's what I did.  Yesterday I browsed E-Bay looking for deals on used lenses for my Canon Rebel.  BINGO, I find a lens and try to put in a bid.  I don't use PayPal so...  BZZZZTTTTT...  I can't even enter a bid.  I try entering a bid for another lens.  BZZZZTTTTT... same thing.  Another?  Same thing.

WTF???

Here's what will probably happen in the future...  Customers will not like this requirement to be 'verified'...  Foot traffic in E-Bay will start declining...  E-bay will need to change their validation.

Just my half-asleep $0.02 worth.