Auction Nation

By ANDREW FERGUSON

Melissa Wicker likes to shop for her friends. And she has a lot of friends--nearly 8 million, at last count. Of course, the word friend is used loosely these days, in an era when e-mail establishes instant intimacy between total strangers separated by thousands of miles. So it's no surprise that Wicker, 46, an assistant district attorney in Isle of Palms, S.C., hasn't met many of her new friends in the flesh. But they're on her mind when she cruises clothing stores and comes upon a tantalizing markdown in designer duds. She buys by the armful, goes home to her computer and within a couple of days has set up her own fashion show--on eBay, in full view of anyone with a modem and a yen to bid on the clothes she puts up for auction. Bids race through cyberspace, winners are declared, and Wicker mails the goods to the lucky buyers--and cashes their money orders and cashier's checks, sometimes for a tidy profit and always with the thrill of a successful sale. "I've been waiting for eBay my whole life," she says.

And she has lots of company, among buyers and sellers alike. eBay makes a lot of people happy, and not just because it makes some people rich. The surprise--in more enthusiastic moments, you might even call it the miracle--of eBay is that it offers online consumers something rarer, more essential, more enduring than a chance to make a profit.

"Community" is an overworked term, too often applied artificially to any motley of people who share a skin color, an income level or a set of political bugaboos. But from the limitless ether of cyberspace, eBay has managed to conjure up the real thing. For many people, eBay does what communities have traditionally done. It not merely provides them financial sustenance but also draws them together with like-minded folk, offering encouragement, rewarding unique talents and interests, giving an outlet for their eccentricities and individuality and in some cases rescuing them from the margins where they would otherwise languish alone.

Consider Carol Sangster of Edmonton, Canada, who seven years ago had to quit her job as an engineering clerk at Canadian National Railways because she was struggling with systemic lupus and diabetes. For several years, she fought for her life. In time she partially recovered. "I became well enough to be bored," she says. Then, 18 months ago, she discovered eBay.

In their travels over the years, she and her husband had acquired acres of stuff. She started posting lots of it for auction. When she was well enough, she began attending public auctions and buying up lots. Today she tests her strength, challenging herself with eBay, working as much as her illness allows. "For me," she says, "it wasn't the sale. It was being part of something again. It was the contact with people. I guess I used it to make me feel better."

Many antiques dealers, who would seem most threatened by eBay, have seen their livelihoods transformed. David James, for example, opened his shop in Alexandria, Va., eight years ago. He deals mostly in what the trade calls smalls: candlesticks, glassware and other such collectibles. He's still got the store, but today his business--and his life--revolve around a warehouse a few miles away, where he stores the treasures he has gleaned from scouting estate sales and flea markets. From a cramped, windowless cubicle, he monitors the hundreds of auctions he has posted--moving anywhere from $40,000 to $75,000 a month. He has hired a full-time employee to oversee his eBay business and plans to move to a new space complete with a miniprocessing center.

For as long as there has been an Internet, of course, there have been anti-Internet fuddy-duddies, pessimists who lament the end of face-to-face sociability as people retreat from the bustling public square to their computers for the anonymous encounters of cyberspace. With some justification, the pessimists can trace the decline of shopping, that most social of activities, from the mom-and-pop corner shop, where everyone knows everyone else, to the department store, where we might recognize one of the cashiers, and from there to the vast warehouse of the superstore, where no one knows anyone--and finally to the Internet, where human contact is reduced to the pulsing of electrons.

But the evidence suggests that eBay represents a return to that earlier one-on-one sociability--and maybe even improves on it, since the Net collapses the traditional divisions of geography and class. Wherever you plant your modem, the fabled new economy arrives--even in the boonies, as Patricia Hoyt calls her hometown of Baker, Mont., roughly 225 miles from the nearest big city, Billings. The old economy of oil and cattle has not been kind to Baker, and when oil prices dropped, business dried up at the motel Hoyt and her husband own.

But Hoyt had a hobby: making decorative glass beads. Thanks to eBay, her hobby is now her livelihood. She sells as many as 3,000 beads a month, for as much as $50 each. eBay has given her more than a new career. She refers without irony to the bead community she has discovered online. Glass beads have spawned an entire network of chat groups and e-mail lists. Many of her customers buy weekly. "If I don't put up any auctions for a week," she says, "they'll write me and ask, 'Are you O.K.?'"

The community angle is one that eBay executives work hard to promote. Users find electronic newsletters catering to their obsessive interests, visit chat rooms where buyers and sellers can get acquainted and swap tips, drop in at a cafe where they can catch up on the latest community news. Everywhere you turn--or click--you find the chipper, boosterish tone of a small-town newspaper--that is, a small-town paper with almost 8 million writers and readers.

Before bemoaning the atomization of American society by eBay and the Internet at large, the worrywarts should talk to Mary Ellen and Don Millbranth. Last year they were strangers, both widowed. Don, 66, a retired engineer, in Wanatah, Ind., decided to sell a paperback book about miniature cabinets, his new hobby, on eBay. Mary Ellen, 61, bought it for $7.10 (including shipping). One thing led to another, as tends to happen on the Internet. After a particularly passionate weekend of e-mail (more than 200 in 48 hours, by Mary Ellen's count), they decided to meet in Mary Ellen's hometown of Huntsville, Ala. It was, needless to say, Valentine's Day. They were married three months later. Ever alert to a public relations coup, the corporate honchos at eBay flew the happy couple to California for a honeymoon. "I never felt such a part of something," says Mary Ellen.

The Millbranths may be an extreme example of eBay's social benefits. A few marriages for every 8 million customers don't exactly qualify eBay as a lonely hearts club. But those few underscore what pessimists miss--in many important respects, the eBay phenomenon is a sign of a fundamentally healthy society. The sociologist James Coleman coined the term "social capital" to describe the shared values and habits that allow individuals to cooperate for a common purpose. Without it, societies collapse.

Given the anonymity of the Internet, eBay places its customers in a risky arrangement, something akin to asking strangers to meet in a dark alley to exchange goods. Trust is the essential element of social capital, and eBay cannot operate without the assumption that your buyer or seller is basically a decent sort. Fraud on eBay is remarkably rare: eBay's figures show fewer than 1% of transactions have involved fraud. Even accounting for underreporting, this suggests that eBayers are trustworthy. Chris Spencer, a show-business manager in Southern California who lists as many as 3,000 items monthly, says eBay confirms for him the essential goodness of human nature. "The average person is honest and decent," he says. "That's what eBay is about--honesty. I have cashed thousands of checks and have had just one bounce."

There's another bit of American folk wisdom that eBay also incorporates: trust everyone, but cut the cards. eBay offers free insurance in case a transaction goes awry, as well as escrow accounts that for a small fee hold the money until a deal is completed. More important, eBay's ingenious feedback system encourages buyers and sellers to post evaluations of one another. In the real world, the reputation of a seller--whether a used-car dealer or a plumber--can be hard to measure. In the virtual world, all reputations are transparent.

Moreover, eBay has exposed America as a nation of collectors. Matchbook covers, cast-iron witches' cauldrons, Pez dispensers, pneumatic grease pumps from the 1920s, Three Stooges memorabilia--you name it, some American somewhere collects it. "We define ourselves by our stuff," says Robert Thompson, president of the Popular Culture Association and a Syracuse University professor who specializes in the study of collectibles. In a democracy, with everyone theoretically equal, people want to be different. We don't have a caste system; we've never had a blood-line aristocracy. We've distinguished ourselves by our cars, by the clothes we wear, by the stuff we buy and sell. "I suppose you can lament all the consumerist tendencies in this, the materialism," say Thompson. "But it gives so much joy to so many people. It's an innocent way of providing a lot of fun."

And fun, of course, is at the heart of the matter. Surely the Internet could be put to darker purposes. We may not live at the end of history, but we live in a country, and increasingly a world, where the large preoccupations of earlier generations have been resolved. We need no longer worry about subsistence, about food and shelter. For centuries philosophers have contemplated just this moment and wondered what would come next. For a very large number of people, it appears the answer is, eBay comes next.

We could do worse.

--Reported by Sally B. Donnelly/Washington and Mitch Frank/New York

With reporting by Sally B. Donnelly/Washington and Mitch Frank/New York