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Yahoo Revamps Its Auction Fees

Bloomberg News

Yahoo Inc., owner of the second-largest online auction service, is reducing fees to list items for sale on its auction Web site and imposing a new fee for sellers based on the selling price of an item.

The company said it will charge a fee ranging from 0.5% to 2% of the final sales price, starting Nov.20. Fees to list items for sale will range from 5 cents to 75 cents, depending on the item’s starting price. The listing fee previously ranged from 20 cents to $2.25.

Yahoo, whose network of Web sites also includes the most-used Internet search service, is trying to take customers from EBay Inc., the world’s most-used auction service. The listing fee at EBay ranges from 30cents to $3.30 an item.

“I don’t think anything’s going to help them against EBay,” said Jeff Fieler, an Internet analyst at Bear, Stearns & Co. “It’s hard to be a distant No. 2.”

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Fieler rates Yahoo shares a “buy” and doesn’t own the stock personally.

Yahoo executives wouldn’t say how much revenue Yahoo generates from its auction business.

The Sunnyvale-based company’s shares rose $1, or 8%, to $12.99, while EBay’s rose $1.83, or 3%, to $55.68, both on Nasdaq.

Kevin Pursglove, a spokesman for San Jose-based EBay, declined to comment on Yahoo’s new auction fees.

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