EBay Inc. plans to offer health insurance to merchants who auction items on its popular site, a decision that may go a long way in keeping its smaller sellers content.
EBay chief executive Meg Whitman made the announcement during the weekend in Anaheim at the company's eBay Live convention for buyers and sellers.
"Over the last two to two and a half years, we have seen an increasing number of people coming onto eBay and making eBay their full-time source of income," company spokesman Kevin Pursglove said Sunday. "We've been hearing from our users that they wish there was some way eBay could work with an insurance provider to get health coverage. In many instances, they had left a brick and mortar job."
The company hasn't worked out the plan's details or determined what the fees might be, but it hopes to offer the coverage by October. It touts the offer for access to group health care coverage as the first for a major online auction site.
"I think it's great," said Kurt Dietrich, of Los Angeles, who makes his living selling handmade cat toys and other items. "Insurance for some people is just too much money, and everybody needs health insurance."
Dietrich has used eBay as his prime source of income since 1999. He already has health insurance, but said he would switch to eBay's coverage provided he could keep his current doctor.
Those eligible for the coverage must be registered with eBay's Power Seller program, and make between $2,000 and $25,000 a month on eBay. The company plans to expand that program to include those who earn as little as $1,000 a month, or as much as $150,000, or more. EBay estimates there are already 35,000 to 45,000 qualified users enrolled and an additional 40,000 to 50,000 who meet the criteria.
Rosalinda Baldwin, CEO of The Auction Guild, an industry watchdog group, said she wasn't sold on eBay's proposal because there are too many questions surrounding how it would be managed.
"I think it's a bad idea," she said. "The Power Seller program is based on how many dollars worth of listings and sales you do through eBay. What happens if your sales drop below the minimum level? Do you lose your health insurance?"
The health coverage offer was seen as part of an effort to cater to frequent eBay users who aren't affiliated with big companies. Critics have said eBay gives companies an unfair advantage by prominently featuring their brand-name wares, creating tough competition for the millions of regular folks who use the site.
Founded in 1995, eBay is the world's top Internet auction site. It has nearly 50 million registered users and Web sites in 27 countries.