A rival auction network

Leading Internet auctioneer eBay saw its shares tumble on Wall Street as Microsoft and two other major online services joined forces to share listings in a rival auction network. The unusual pooling of resources among the Web_s top competitors acknowledged the explosive power of the electronic flea market. EBay, which pioneered the concept, listed 3 million items for sale yesterday. Microsoft_s MSN, Excite At Home and Ticketmaster Online-Citysearch joined an auction network that makes items listed for sale at one site available for bidding on all the others. Another top Internet "portal," Lycos, and nearly 100 smaller sites are already part of the network. The network was created by Woburn, Mass.-based FairMarket, a two-year-old company that sold an equity stake to each of the four large portals that joined.The new network does not include two of eBay_s top competitors, auction sites at Yahoo and Amazon.com. But analysts said that the venture could present a substantial challenge to eBay_s dominance and put pressure on stand-alone sites to join a network. Shares of eBay fell 7 percent yesterday, to $141, while the companies that joined FairMarket all rose. Ticketmaster jumped 9 percent, while Excite At Home, Lycos and Microsoft each rose by about 3 percent. With the addition of yesterday_s players, the FairMarket network now has about 100,000 items for sale. While that is still a tiny fraction of eBay_s listings, the FairMarket sites together have 48 million registered users--more than 70 percent of the total Internet audience, said FairMarket_s chief executive, Scott Randall. The network will function invisibly to consumers who will buy and sell through the auction pages of MSN.com and other member sites. Each affiliate will customize its Web pages and charge different transaction fees. MSN, for example, said it will charge nothing to list items and will collect fees on each sale ranging from 1.25 to 5 percent. Lycos and Excite, by contrast, are waiving all transaction fees initially in a bid to attract customers. About a third of each fee will be kept by the listing site, a third will go to the selling site and a third to FairMarket, according to Randall.