AuctionWatch Defies eBay in Listings Dispute

The simmering dispute between online auction listing service AuctionWatch.com and auction giant eBay (Nasdaq: EBAY) reached the boiling point as AuctionWatch said it has developed a new technology to put eBay auction listings on its site.

The San Bruno, California-based company was ordered by eBay in November to refrain from listing its auctions on its universal search feature. AuctionWatch, which launched in January 1999, lists ongoing auctions from approximately 300 auction sites, including Yahoo!, Amazon and eBay.

eBay claimed that its intellectual property rights were violated, and blocked AuctionWatch servers from conducting searches on its site in November after both sides failed to reach a compromise in discussions leading up to the action.

Pitched Battle

AuctionWatch said it developed “proprietary technology” that makes it possible to reintegrate eBay auction listings on its site. The company said it had been circumventing eBay’s efforts to block its access by employing a temporary solution that listed the results in a separate browser window.

“This is not simply about AuctionWatch.com and eBay,” said AuctionWatch CEO Rodrigo Sales. “It strikes to the heart of a much bigger issue. The foundation of the Internet lies in freedom of information. eBay’s actions are not only contrary to the best interests of consumers, but have the potential to set a dangerous precedent that could threaten the evolution and growth of the Web.”

eBay was not immediately available for comment. However, a spokesman did say in published reports that eBay was informed of the move by AuctionWatch and that the company had yet to formulate a response.

Takes One To Tango

While Sales espoused lofty ideals of Internet pluralism in his statement, the fact is that AuctionWatch needs eBay, while eBay has no real need for AuctionWatch.

The company is, after all, a community of 7.5 million registered members, and its traffic is increasing at a tremendous rate. If anything, eBay might be more intent on leveling off so that it can prevent the kind of catastrophic crashes that have dogged them since last summer and gave the company a public relations black eye.

AuctionWatch is not the only auction listings service to do battle with eBay. Bidder’s Edge was on the receiving end of a lawsuit last month, while others like AuctionRover.com have opted to sign a licensing agreement with eBay.

Sales said his company had a similar option, but declined to sign it.

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