EBay, PCHome launch new auction site in Taiwan

Plan is to give Yahoo Taiwan a run for its money

EBay Inc. and Taiwanese portal operator PCHome Online Inc. announced their new joint venture Web auction site on Wednesday, an effort aimed at competing with market leader Yahoo Taiwan Inc.

PCHome, which has taken over day-to-day operation of the joint venture, said the beta version of the new auction site will open Sept. 25. Members of their individual sites, http://www.tw.ebay.com/ and http://bid.pchome.com.tw/, will be transferred to Ruten.com.tw by the end of October. Users will be able to use existing accounts and passwords on Ruten.

The companies plan to combine their Internet auction traffic, which accounts for about an 8 percent market share in Taiwan, on Ruten.com.tw so they can increase their total number of listings and draw more users. Yahoo holds over 50 percent market share: users prefer it because of its wide range of auction listings.

"This partnership is aimed at challenging Yahoo," said Simon Yeh, chief operating officer (COO) at the new site.

For now, Ruten.com.tw will remain free of charge for users, in contrast to Yahoo Taiwan, which started collecting a 3 percent transaction fee from sellers at the beginning of this month. Ruten.com.tw hopes users will desert Yahoo Taiwan for its no-cost transactions.

"Currently, there is no need to collect user fees. We're focused on increasing auction listings. The best-case scenario would be to not ever have to collect any user fees," said Jan Hung-Tze, chairman of PChome Online, at a news conference in Taipei. He is also chairman of the new joint venture.

Ruten.com.tw will collect fees for advertising as one way to generate revenue.

Although PCHome is taking charge of the new auction site, some eBay personnel have found work at the company. Ruten.com.tw's new COO was formerly in charge of transaction safety and security at eBay Taiwan. In June, eBay Taiwan representatives said the company planned to lay off most of its work force in Taiwan, around 40 people, but that some would find work at the joint venture site and others would remain at a small eBay office in Taipei.

PCHome and eBay have jointly invested about US$7 million in cash in the new site, in addition to existing resources such as offices and Web property. The registered capital totals NT$288 million (US$8.79 million).

Copyright © 2006 IDG Communications, Inc.