The Wall Street Journal reported that eBay will shut eBay Eachnet in China and will replace it with a new site in a partnership with Tom Online. According to the financial newspaper, reports are that eBay will own 49 percent, and Tom Online will own 51 percent.
This would mark a major shift from last year, when eBay committed $100 million to its China operations and CEO Meg Whitman touted China as its biggest long-term opportunity in terms of local markets during the Fortune Global Forum in Beijing, China.
While the Journal reports that eBay will take down the site for intra-Chinese trading, it will leave parts of it to enable cross-border trading. However, eBay has placed limits on cross-border trading on its Chinese site due to issues of counterfeiting, spam and fraud.
After AuctionBytes reported on the problem of "Chinese BIN Bandits" in May (http://www.auctionbytes.com/cab/abn/y06/m05/i03/s01), eBay acknowledge the problem of cross-border trading problems (http://www.auctionbytes.com/cab/abu/y206/m06/abu0169/s02), and it has taken special consideration with how Chinese users can interact globally. For example, with its new anti-counterfeiting initiative, eBay said China and Hong Kong are prohibited from listing items eBay has ruled as prone to counterfeiting, both on their local sites or on any other eBay site (http://www.auctionbytes.com/cab/abn/y06/m11/i29/s01).
eBay has been making some major moves of late, including a reorganization within its Marketplaces unit (http://www.auctionbytes.com/cab/abn/y06/m12/i05/s01) and its Skype unit (http://www.auctionbytes.com/cab/abn/y06/m12/i05/s01). However, there are no reports of any impending layoffs in China as a result of the expected deal with Tom Online.
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