August 8, 1997 7:00 PM PDT
Papers may get into auctions
Now, seven months later, the Courant has acquired Auction Universe, an online auction site that holds a treasure's chest of promises.
While the Internet content market has heated up with localized content sites, which are trying to steal away ad dollars from newspapers, auction sites have quietly been making a bundle from goods that range from Beanie Babies and rare coins to movie posters. (Del Vecchio lost in his bid for a Breakfast at Tiffany's poster, but he's since bought lots of memorabilia from auction sites.)
"The newspapers years ago gave up the market of low- and niche-value collectible goods," said Pierre Omidyar, the CEO of eBay Auction Web, which has been in the auction business two years. People could no longer afford sell goods under $30 when ads cost at least $10 to run.
"What Times-Mirror is doing is trying to get back into this market," Omidyar added. "This is a very fast-growing market. I think it's the beginning of a trend."
Del Vecchio agreed. "We feel quite strongly that this could be a really important thing for us." He said that Times Mirror plans to license the technology to other newspapers so they, too, can recoup the nickel-and-dime market--and Times Mirror can make a buck while they do it.
Auction sites make money by taking a small cut from each sale. There is virtually no overhead. Usually, buyers and sellers make their own arrangements to exchange goods. People who tend to participate in the auctions tend to be junkies, in both senses of the word.
Not only do people like to buy and sell, but also they think of auction sites as entertainment, according to Larry Schwartz, president and CEO of Auction Universe. For newspapers, entertainment can translate into dollars: People lured to the auction site for fun and buying will be only a click away from the news.
Schwartz said that eventually there will be a newspaper component to complement the online component, but he would not elaborate.