As most auction site resellers already know eBay has recently raised its fees again. The auction giant has increased its fees by 60% with no corresponding improvement in services beyond a promise to improve its much maligned telephone customer support. The monthly basic store fee went from $9.95 to $15.95. The 10-day standard listing fee doubled from $.20 to $.40. While refusing to comment on what the rate increase meant for the company’s revenue eBay has said that the hike will be good for everybody. They didn’t say how exactly. I suppose resellers will stop losing sleep over how eBay executives will pay for their vacations.These changes in pricing will take a huge bite out of the profits of its customers particularly the PowerSellers. Some retailers have said that the increase has threatened their business’ very existence. Despite eBay’s recent acquisition of Shopping.com, which will allow its users an even larger amount of exposure, many of its customers have begun looking at switching auction sites. These customers often feel that they have been asked to pay for eBay’s explosive growth. Instead of being rewarded for making the company a huge success the big sellers have been punished with the higher fees. In a recent survey of online auctioneers more than half of them said they would gladly change auction sites if presented with a good alternative.Yahoo Auctions, possibly sensing the anger of many eBay customers, eliminated many of their fees entirely. No longer will Yahoo Auction users have to pay listing or transactions fees. The company used to charge 2% on most sells and 1.5% on more expensive items but no more.However, the fee reduction will not affect most overseas customers, notably in Japan and Canada. Yahoo got into the Japanese auction market well before eBay and is the dominant auction site in the country giving them very little motivation to include Japan in its new pricing structure.The fee elimination, that began June 6, 2005, will make a huge difference on the bottom line of its customers. For example, a dealer who sells ten items per day at ten dollars each will save $670 a year on transaction fees alone.Rob Solomon, Yahoo Shopping’s vice-president, claims that the move has been in the works for some time and has nothing to do with eBay’s fee increase or purchase of Shopping.com. They say the change is part of a larger strategy to increase its already impressive web presence by increasing its total number of web pages. They also hope to increase the money they make from the paid search listings and banner advertising offered by Yahoo’s marketing division.There may be some truth to the claim. Before 2001 Yahoo charged no fees for listing items and saw their auction site shrink from 1.5 million users to about 350,000. At the time they claimed that the introduction of fees would improve their service and eliminate many problems. How times change.Some of its established sellers have expressed doubts regarding Yahoo’s elimination of fees saying that the auction site will become awash with bogus and junk listings since there won’t be anything to prevent it. Yahoo promises that they have methods in place to detect fraud. These promises seem rather vague and we will just have to wait and see if Yahoo makes good on them. Businesses listing on Yahoo Auctions will also probably see an increase in non-paying bidders, always a sure source of difficulties.While it is unlikely that the changes being made by Yahoo will have any serious long term affect on eBay it does show that the era of eBay’s absolute dominance may be coming to an end.As the world of online auctions expands there is more and more room for healthy competition. The established auction sites will have to offer more services and better pricing if they don’t want to see their market share contract.The pressures that will change the online auction industry must come from the sellers. The first step towards forcing improvements is recognizing that unless the titans of online auction believe that their customers might abandon them they will never change the ways they do business.Art Mickelwraith is the author of the Wholesale Buyer’s Guide at TopTenWholesale.com. He can be reached at artmicklewraith@gmail.com.