Well, a big part of the problem is Metcalfe's Law, of course. But let's think about this: How hard is it to offer a couple of decent looking templates for peop

Well, a big part of the problem is Metcalfe's Law, of course. But let's think about this: How hard is it to offer a couple of decent looking templates for people to make their own site, to that it isn't such an eyesore? That's not a bug, it's a feature. I and others have speculated at length about why being an eyesore is a potential advantage for a site that invites the general public to contribute -- people are happier to design their own pages if they aren't being scored against a high standard. Moreover, for an eBay seller, being downscale is a potential marketing advantage. Ask yourself: who seems more likely to give you an amazing deal on the rare antique watch that you're looking for: a random guy who found it in his late father's basement, knows nothing about watches, and is nearly illiterate? Or a professional used-watch retailer with a slickly designed website? It's telling that one of eBay's biggest competitors is Craigslist, which has far less visual design. How hard is it to implement a better form of search and categorization? Pretty hard, I'd wager. What is your problem with eBay's search? I always thought it worked pretty well. Do you have some specific use cases to complain about? Designing categorization systems is hard, very hard. Go Google up "taxonomy vs folksonomy" and you'll find guys like Clay Shirky complaining about it. How hard is it to develop a form of authentication to cut down on all the fraud that takes place on Ebay? Isn't it easy? If you're a buyer, require an escrow service and a money-back guarantee, and bid low enough that you offset the potential cost of return shipping and handling. If you're a seller, require payment in advance and either sell "as is" or make the buyer bear the cost of return shipping. Of course, the added friction is going to cost you money, time, options, and bidder attention, so most eBay customers are nowhere near as paranoid as this. I conclude that these people are happily choosing the risk of being defrauded in the hope of saving a couple bucks. The general problem with building a less-fraud-prone version of eBay is that we already have things like that: they're called "retail stores" and "pawnshops" and "used-equipment dealers". You can compete with these guys, just as you can imagine competing with eBay, but they are veterans who know how to operate within thin margins, so don't expect it to be trivially easy. eBay buried a lot of competitors in the first dotcom boom.