October 24, 2000 2:20 PM PDT

eBay says system upgrade tied to recent outages

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eBay apologized to customers Monday for a system upgrade that has led to intermittent outages and frustrating service problems during the past two weeks.

In a note to members on its annoucements board, eBay apologized for the problems and blamed them on an upgrade of its database that it began in August.

"It may seem like it should take a short time to implement these improvements," eBay said in its note. "But it is quite a task to perform installations and testing while keeping the existing site running. We conduct lots of tests to make sure that these transitions are as seamless as possible. Sometimes they are not. And for that, we are very sorry."

eBay representatives did not respond to repeated calls seeking comment. In its note, eBay said it should complete the upgrade in the next "seven to 10 days."

In the message boards on eBay, AuctionWatch.com and Honesty.com, eBay members reacted to the company's explanation. Some members praised eBay for giving details about the outages and for taking steps to improve the stability of the site.

"It's time that we thank them for giving this detailed coverage to us," one seller wrote on the eBay message board. "They have listened to our concerns and have responded."

But other members criticized the company for not giving details earlier and for not crediting sellers for fees they paid.

"How about an apology with a refund of listing fees?" one auction seller wrote on AuctionWatch. Comparing eBay to a utility such as a cable company or phone company, the seller said eBay should pro-rate its fees to account for its outages and system problems. "We pay our listing fees and expect to get reasonable service for such fees."

Other sellers threatened to protest the outages and eBay's response to them by boycotting the service.

"I decided to stop selling until eBay fixes their problems and offers real customer support when things go wrong," one eBay member said. "I used to come here to buy and sell because it's fun. I'm getting absolutely no fun now and not much money either."

Although such boycotts have been threatened in the past, they have not had a significant impact on eBay's success.

The system upgrade and subsequent problems come amid a stellar earnings report last week from the San Jose, Calif.-based company that gave support to the company's sky-high future earnings expectations. In a discussion of its financial results with investors and analysts, eBay executives said that the company's investments in upgrading its technology had begun to pay off.

"We have made significant progress in stability and scalability," eBay chief executive Meg Whitman said in a note to members on the announcements board. "Our site again performed above the 99 percent level this quarter."

As a result, eBay has begun to scale back spending on operations, Whitman said. But the latest system problems could slow down that effort.

On Thursday, eBay took its site down for unscheduled maintenance. The site was down about 40 minutes, eBay said. On Tuesday, eBay had an hour-long unplanned outage. Despite the hour-long outage, eBay did not extend auctions affected by the downtime. On Oct. 15, eBay took its system down to perform "preventative maintenance." The company warned members of the downtime just 10 minutes before taking the system down. Although the maintenance was scheduled to last 10 minutes, eBay said the system was down about 40 minutes.

"We apologize for this necessary inconvenience, and appreciate your understanding," eBay said in a note on its announcements board concerning the Thursday downtime.

eBay began to upgrade its system in August to determine whether it could handle future customer and auction growth. In its note to members Monday, the company gave more details on the technical changes, explaining that it has upgraded its database program from Oracle 7.3.4 to Oracle 8i.

As part of the upgrade, eBay has begun to divide its system into different databases and onto different systems. The goal is that if one feature on the system goes down, the rest of the site will still be available, the company said.

The upgrade immediately resulted in a series of sporadic outages and glitches involving the personalized "My eBay" pages and the bidding history of individual items.

The current problems also have affected the My eBay pages and the bidding history, as well as certain search features. eBay explained in its note that it turned off those features during high traffic times to keep the rest of the eBay system up and running as it upgraded the database.

"While all features are important, we try to temporarily disable those that have the most significant impact to system load and those that minimize impact to people?s ability to find, view and bid on items," eBay said in its note.

But by turning off those features, eBay has made it difficult for bidders to find and bid on items, said Rosalinda Baldwin, who monitors eBay's system problems as editor of The Auction Guild online newsletter. In addition, the problems members have encountered have been worse than eBay has acknowledged, she said, with the hard outages much longer than eBay has stated in its postings.

"The problems have been endless," Baldwin said. "If you can't search and bid on an auction site, what good is the site doing? None."

The system problems come as the holiday shopping season draws near. Last year, eBay became a popular gray market for hard-to-find toys such as the Amazing Ally doll. That phenomenon could repeat itself this year with sellers listing items such as the PlayStation 2, which is in high demand due to production cutbacks.

The system problems could be an indication that eBay's listings are already beginning to climb, said Mark Gambale, an analyst who covers the online auction industry for Gomez. "We're likely to see more problems as eBay gets closer to a spike in listings," he said.

But eBay said it hoped to have the problems contained soon. "Our goal is to make these improvements in advance of the holiday season," the company said in its note.

eBay's policy is to extend auctions and refund fees only when outages last two or more hours.

eBay said in its note that it would reevaluate that policy.

"Some of you have written to us asking us to extend auctions during these periods of feature unavailability," eBay said. "In order to retrieve and change the information in the database, we would have to completely shut down the entire system for at least 30 minutes."

But eBay should listen to its members, said Peter Marino, a site operations analyst for Jupiter Communications. Although eBay's investment in technology will probably prevent the hours-long outages the site experienced last year, the company still needs to be sensitive to its customers, he said. Upset by problems like those eBay has had lately, members could turn to sites such as Yahoo or Amazon that offer more stability.

"They don't have the luxury other sites do concerning downtimes," Marino said. "They've got people 24 hours a day making transactions that mean a lot to them.

"If the problems continue, the key is not going to be so much on the technical side, but on how they handle their customers. They may have to address that: How are they are being accommodating to what their customers want?"

 

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