Guardian eCommerce - Key E-Commerce News & Tips

Google said the Autolink feature included with its new toolbar is meant to create a richer Web experience and that consumers will have choices of where certain links lead them. And Guardian eCommerce couldn't agree more.

However, Google is already facing mounting criticism for its decision to include the AutoLink feature in the latest version of its popular browser toolbar for Internet Explorer (IE). Google is facing criticism for a feature in the latest version of its browser toolbar that can add hyperlinks to Web pages, potentially giving the search engine giant powerful control over where surfers go on the Internet.

The feature, known as AutoLink, is being criticized by some bloggers, who see the tool being used by Google much in the way that Microsoft tried to do when it first introduced Smart Tags into its office suite. Eventually, Microsoft stopped using Smart Tags to funnel Web traffic when trademark and other concerns were raised.

Similarly, with AutoLink, Google could theoretically boost traffic to sites that were paying it for premium search traffic. For instance, AutoLink pages that contain street addresses are turned into links to Google's map service and the ISBN tracking numbers used by book publishers automatically create a link to Amazon.com. Other links create pathways to Carfax.com and various package shipping services.

Damage potential? We don't think so, as doing so could provide a huge boost to Google's revenues, but based on the early outcry over the feature, it might also damage its public image. Though Google is a dominant Web player, the comparisons to Microsoft are not intended to be complimentary. Any missteps in the public trust realm could send users to competitors such as Yahoo, MSN and Ask Jeeves. Google said the feature is meant to create a richer Web experience and that consumers will have choices of where certain links lead them.

But let's make one thing clear, this move greatly differs from the Smart Tags attempt by Microsoft. For instance, Google's toolbar has to be downloaded by users -- it's not pre-packaged on new PCs like Microsoft's OS. And it only works with IE.

While Google's users have more choices, the technology could easily be duplicated by MSN and Yahoo, creating a situation where users had far less control over where their Web surfing took them.

Jupiter Research analyst Michael Gartenberg noted the uproar over Microsoft's Smart Tags was immediate and vociferous and that so far the Google reaction has been muted. That's in part because the technologies are different, he said.

More information at Guardian eCommerce.

Brought to you by the Guardian eCommerce Safe Site Privacy Seal Program.

EBay, PayPal, and Visa are hooking up to catch some phishing fraudsters.

The high-tech heavyweights yesterday became the first participants in a new anti-phishing aggregation service dubbed the Phish Report Network and organized by WholeSecurity, an Austin, Texas-based company that screens Web sites for suspicious behavior.

Phishing is an act of fraud that involves an attempt by scam artists to steal the identities of Internet users by sending out e-mails or links to Web pages mimicking popular Web sites. These phishing e-mails and Web sites commonly ask Internet users to provide sensitive personally identifiable information, such as passwords, credit card numbers or bank account information.

Fraud Report: The Phish Report Network allows any company being victimized by phishing attacks to immediately and securely report fraudulent Web sites to a central database operated by WholeSecurity. Other companies subscribing to the Phish Report Network can then access the database or receive real-time notifications of known phishing sites, enabling them to more effectively protect consumers by blocking these sites in their user-facing security applications.
Jupiter Research retail analyst Patti Freeman Evans told the E-Commerce Times that the Phish Report Network is a significant development in the fight against phishing.

"Phishing has been a challenging issue for a lot of consumers," Evans said. "Whatever the large brands, especially the ones that are targeted by phishers, can do to try to thwart these scams will make consumers more trusting of their sites overall. Phishing is an important issue for online retailers to try to police."

The Anti-Phishing Working Group, a pan-industrial and law enforcement association focused on eliminating fraud resulting from phishing and e-mail spoofing, recently reported an 8,000 percent increase in phishing scams last year.

Additionally, the organization warned that phishing attack methods are becoming more sophisticated, such as incorporating malicious code into fraudulent Web sites, which could further victimize consumers. Industry experts agree that the escalating phishing problem, if left unabated, could result in significant financial losses.

"Phishing is the fastest-growing segment of spam being sent worldwide today, victimizing both legitimate online companies whose brands are being hijacked and consumers who are unwittingly providing their personal information to criminals," Ryan Hamlin, general manager of the Safety Technology and Strategy Group at Microsoft, said.

To Catch a Phish: Hamlin said the data that the Phish Report Network will provide can help Microsoft immediately better defend its millions of users worldwide against these attacks.
Using the Phish Report Network's secure service, participating companies list confirmed phishing sites. Recipients such as Microsoft, other Internet service providers, or user-facing security vendors obtain the aggregated lists and can incorporate them into various software, e-mail and browser services to help protect consumers against online fraud.

Any company impacted by phishing sites or with the ability to protect end users can participate in the Phish Report Network, based on meeting qualification criteria and adherence to program standards. The aggregation service will become increasingly valuable as additional companies join the Phish Report Network.

"EBay and PayPal's participation in the Phish Report Network is one of many steps we have taken to improve security of the e-commerce experience," said Howard Schmidt, eBay (Nasdaq: EBAY) and PayPal's chief security strategist and former White House cyber-security advisor. "As we co-develop technologies, educate online users and work with law enforcement, we can help significantly reduce the effect of cyber criminals."

Brad Nightengale, department head of Emerging Products at Visa, said the company is joining the group to play a key role in stopping phishing before it happens in order to maintain global consumer confidence in the e-commerce channel. "As a leader in the payments industry, Visa is focused not just on shutting down phishing sites, but preventing phishing e-mails from ever reaching consumers worldwide," Nightengale said.

Potential Impacts: Peter Selda, chief executive officer of WholeSecurity, is confident that the Phish Report Network will bear fruit as the industry consolidates to fight phishing. "The partnership we have formed with the founding members of the Phish Report Network is an important, groundbreaking step in reestablishing consumers' confidence in online channels," he said.

Jupiter's Evans said online consumers shouldn't hold their breath for overnight results, but anything e-tailers can do to thwart the rapid growth of phishing is a postive step for everyone on the World Wide Web.

"It's important for these brands, from a business perspective, to protect their brands," Evans said. "If their brands become undermined from a trustworthiness standpoint by phishing and other forms of online fraud, then that's going to hurt them in the long run. It really behooves them to get in front of it as fast as possible."

More information at Guardian eCommerce.

The online auctioneer eBay may be the best-known brand online but other, less recognizable sites now are competitively bidding for the business of smaller merchants who want to sell their goods in cyberspace -- from used PCs to old bowling balls.

The storm over the price that eBay charges its customers to access its online auction technology is being used by rivals, such as MyPoAss.com and others, to build their own online businesses, experts told UPI's The Web.

"We just felt like folks needed an alternative to eBay," said Todd Gurganus, president and chief executive officer of MyPoAss.com, located in Smithfield, North Carolina. "Folks work hard for their money. On the back-end, we're going to be 50 percent cheaper. On the front-end, we don't have any fee."

EBay Fee Controversy : The site has been in the testing phase since last fall, but debuted publicly only last week in the middle of a controversy over the fees eBay charges. In late January, a group called Professional eBay Sellers Alliance -- a non-profit trade association comprising more than 600 of eBay's highest-volume sellers, who collectively account for $1 billion in annual sales -- expressed dismay at the recently announced price increases by eBay.

"For sellers who often operate on exceedingly low margins, the substantial increase in fees will dramatically affect their business -- eBay fee changes include a 40 percent increase in the gallery fee, up to a five-fold increase to use the Buy It Now feature, and a 52 percent increase in commissions charged on eBay Store sales," the PESA said in a statement. "Overall, our members are reporting that they will pay up to 22 percent more to eBay than before the increase. That is unprecedented, and will have broad marketplace implications."

The pressure from the industry seemed to work -- to a point. The online auctioneer, located in San Jose, California, issued its own statement last weekend indicating it would slash fees for the cheapest items for sale on its site.

In a letter distributed to eBay sellers, Bill Cobb, the company's president for North American operations, said the company would give sellers who operate eBay stores a US$15.95 discount this coming April. That is equivalent to a one-month subscription for store status, but basic service still will increase from $9.95.

Sales Revenue Fallout: The moves to appease smaller retailers will not be without consequences to eBay, at least in the short term. Wall Street's Prudential Financial issued a research note February 7 indicating the one-time refund of $15.95 on the April fee for eBay retailers, as well as a reduction in listing fees for items priced at 99 cents or less, may impact sales revenue.

Likewise, the investment bank Morgan Stanley has issued research claiming eBay's stock is "overweight," and Deutsche Securities has placed a "hold" recommendation on the stock. Prudential Financial (NYSE: PRU) has set a "neutral" weight for the stock, which it targets at $87 per share.

There was no immediate public reaction from the PESA. "We have a wide range of members who have a wide range of opinions on the matter," David Yaskulka, a spokesman for the association, told The Web.

Rivals were quick to jump on the news, however. "Folks want something simpler and easier than eBay," Gurganus said. Working with a local technology firm and a Web-hosting service in New Hampshire, MyPoAss.com is a self-funded effort.

"We're on a shoe-string budget," Gurganus noted, but added what the operation lacks in cash he is more than making up for in wit. The site allows customers to list without paying a fee and enables them to stay live on the site until their product sells. Gurganus also provides customers with storage space for up to five digital photos at no charge; the sixth photo costs 25 cents to post.
He said the fees for product sales is 5 percent of the first $25 of the sales price. For products priced over $1,000, the fee is 1.5 percent.

Frustration Nothing New: "A $1,500 item would run you approximately $33 after the sale to list on our site," said Gurganus, who hopes to build a $400 million business online. Frustration with eBay is nothing new. PearlParadise.com left eBay as a merchant and launched its own stand-alone retail site after about five years online with the big auctioneer.

"When I first started out, [eBay] made sense because the Web was beyond my comprehension," said Jeremy Shepherd, the founder of the site, whose firm is in Santa Monica, California. As he learned to manage online sales, however -- which totaled approximately $5 million last year -- Shepherd ventured out on his own. Others may do the same in the future.

"There are so many sellers out there," he said. "That's why we don't sell on eBay anymore."
Many other merchants remain satisfied with the business model that eBay created, particularly the so-called eBay power sellers, who work closely with the company. Non-technology firms are doing deals with eBay, too, including QuikDrop International, which this week announced it was opening 16 eBay drop-off stores in Colorado, Wyoming and Montana.

The sites are cyber-age junk stores, where anyone can drop off a product valued at $50 or more and have it digitally photographed and listed on eBay. After the item is sold, the customer receives a check, less the eBay and QuikDrop fees. There now are some 34 such stores in the United States and 100 internationally.

More information at Guardian eCommerce.

For consumers and e-business owners alike... a new company in the anti-phishing space is offering a free program that acts much like a firewall for Web sites to protect computer users from online fraud attacks.

Guardian eCommerce and the Safe Site Approval And Internet Privacy Seal Program welcomes FraudEliminator to the Web World, a security software startup, that is offering the first product to provide comprehensive protection to home Internet users from online fraud schemes and phishing attacks.

Phishing is a tactic criminals use to trick computer users to visit a fraudulent Web site or respond to phony e-mail messages and disclose person identification and financial account passwords.

There is NO Spy-ware. Unlike some other freeware products that are delivery vehicles for camouflaged adware and tracking code, FraudEliminator is completely safe, the company says. The company and its product go by the same name.

"It doesn't contain adware or spyware bundled with it," CEO Jeffrey Hellman told TechNewsWorld. "We are opposed to any sort of user tracking. Our product has a strict privacy policy."

The company hopes to make money by protecting users against online identity theft. The profit is expected to come from a paid product down the line.

"Right now we are not making money," Hellman said. "We want to improve our block list [this is a list of phishing Web sites] and eventually offer a product for purchase by offering more features."

The California-based company was formed in mid-2004. It released FraudEliminator in November.

So far, the product has several thousand users. "We're picking up new users slowly. Hopefully, the Tell-A-Friend feature will bring us more customers," Hellman said.

In the meantime, the free version packs a lot of power. It installs a toolbar that protects users by automatically identifying and blocking online fraud.

FraudEliminator also gives users an opportunity to fight back against online fraud by letting them report fraud incidents to the company's central database.

Additionally, the product includes other popular toolbar functions, such as integrated search capabilities and user-configurable pop-up protection.

FraudEliminator offers users one feature not available in any other product, toolbar or otherwise: It identifies the country of origin of every Web site. "We use a block list that catches just about everything," Hellman said.

The program compares Web sites against the company's known list of URLs that might be phishing hideouts or hacked sites. It automatically contacts the database every hour for block list updates.

How It Works...The program's code is written for ease of use and functionality.
"Until now, users who were concerned about phishing have only been offered difficult-to-understand advice like 'stop clicking on links in e-mail' or 'inspect the address bar of every Web page you visit,'" Hellman said. "We developed FraudEliminator because we believe average Internet users need a simple-to-use, free-of-charge tool that finds and blocks fraud on their behalf."
FraudEliminator maintains a real-time threat database that tracks identifying information about every known online fraud threat. To keep the database up to date, FraudEliminator has built a network of fraud incident collection points.

The program tracks results and reports signs of possible fraud to FraudEliminator's server. But it does so anonymously so user identification is not recorded.

If users want to initiate a more detailed fraud incident report, they can send it from within the program. That report, however, identifies the user.

Maintains Fraud Database...Every fraud incident is reviewed by the company's fraud analysts to ensure the integrity of the database. Adding yet another layer of protection, FraudEliminator has also developed a proprietary set of statistical algorithms designed to recognize signs of fraud.
For example, the program would automatically block a fraudulent Web site claiming to be the user's bank. It also would recognize a financial contact that is actually based in Moldova or another unusual location and would block the Internet connection.

The program also recognizes other telltale signs of phishing sites and blocks them as potentially fraudulent.

The program jumps into action as soon as a user clicks on an offending Web site. That site is then added to the FraudEliminator database, so other users are protected from viewing it as well.
This is done in conjunction with FraudEliminator staff going out and identifying dangerous sites.

Foolproof Operation...The problem with other attempts to block phishing, Hellman said, is the alerts are too small and disappear too quickly. Users either don't respond quickly enough or mistakenly click an approval button that overrides the security warning.

"We give users the ability to interrupt a page as it is loading and block it until the user says to display the page," Hellman said.

Thus, FraudEliminator blocks a page so the user can evaluate the warning. The page will not load. Instead, the screen displays a large red and black warning. A big training tag tells what is wrong with the site.

In cases of sites that are merely suspected of fraudulent activity, the user can cancel the warning and continue with the surfing activity. However, for known fraudulent Web sites, the program blocks access and does not give users any opportunity to bypass the blocked page.

Free Download...The free download of FraudEliminator can be accessed at http://www.fraudeliminator.com. Company officials said they have designed a security program so safe and easy to use that you can install it on your grandmother's machine.

More information at Guardian eCommerce.

In response to rapidly mounting complaints, eBay has announced cuts in user fees and enhanced customer service (for their North American operation), the Financial Times said today.

In a posting on the Internet auction site Sunday, Bill Cobb, president of eBay North America, conceded he had heard complaints from customers on a number of issues besides fees, including "customer support, the amount of change we make to the site on a regular basis, and trust and safety."

To improve customer support, Cobb said within 90 days, the company would end its practice of sending automated responses to users' e-mails, instead using an expanded customer services team to handle queries.

The company will also provide telephone support to all customers of its eBay Stores service and cut its minimum insertion fee from 30 cents to 25 cents.

The biggest change is the company's offer of a month's free subscription worth US$15.95 to customers who run their stores on the eBay site.

More information at Guardian eCommerce.

That basic eBay Store subscription will be raised from US$9.95 to $15.95 per month. Sellers will also pay a Final Value fee of 8 percent of the closing value for sales up to $25. Fees range as high as 16 percent for higher value items. Analysts said they are not surprised that eBay is extending an olive branch to its members.

In the wake of widespread complaints about fee increases on sellers, Ebay has said it will reduce some of the charges and boost customer service in the U.S. and Canada. However, the online auction giant is standing firm on its move to hike Final Value fees on inventory format listings and Store subscription fees.

It is unclear if threats from the competition or user complaints spurred eBay to action.
One thing is certain: eBay sellers were up in arms over the online auction giant's plan to raise the monthly fee it charges to sellers by 60 percent. That price hike is still scheduled to take effect at midnight on February 18.

Are we surprised that eBay is extending an olive branch to its members?? Other companies should learn a valuable e-lesson from eBay's experience here.

More information at Guardian eCommerce.

Guardian eCommerce provides a Web reading package for online consumers, which deals with consumer protection.

Consumers can learn more about safe online shopping, credit card fraud protection, Internet fraud prevention, and current consumer alerts.

Check out the following Guardian eCommerce consumer protection tips for more information:

-Credit Card Fraud Protection
-Internet Fraud Prevention
-Safe Online Shopping Tips
-Report Internet Fraud
-File A Complaint
-Current Consumer Alerts

Guardian eCommerce is dedicated to exposing trustworthy sites on the Web while helping online consumers to make wise decisions when transacting online.

For more information, visit Guardian eCommerce and learn more about the Safe Site Approval And Internet Privacy Seal Program.

With other forms of fraud factored in, including Web services or computer sales that were never completed, some 53 percent of all reported fraud complaints stemmed from the Web, the FTC said. However, identity theft seems to pose the most immediate threat to the continued success of e-commerce (see the Guardian eCommerce consumer alert page).

In a reminder of a lingering threat to the growth of online commerce, a new report from the FTC (Federal Trade Commission) says identity theft -- such as phishing over the Internet -- continued to be the most prevalent form of consumer fraud reported to authorities last year.

In fact, complaints stemming from online activity dominate the list of top consumer problems. For instance, auction fraud complaints ranked second, making up 16 percent of all FTC inquiries, with some 98,000 individual reports in 2004, ranging from incomplete sales to allegations of false advertising in auction listings.

Yes, there is a surge in Phishing, however, identity theft, which has been fueled by a surge in phishing attacks and often involves complex international rings where personal data is sold and resold, seems to pose the most immediate threat to the continued success of e-commerce. The FTC said awareness of the problem of identity theft and a streamlined process for reporting it might have helped drive the increase in reports.

In 2004, 39 percent of some 635,000 consumer fraud complaints stemmed from identity theft. It was the fifth straight year the problem generated the lions share of the complaints the FTC logged.

In the long run, consumer complaints will help stem the tide of identity theft and other forms of fraud that are prevalent online because those reports are thoroughly investigated and often result in arrests or the breakup of fraud rings.

By filing complaints, consumers are one click away from thousands of law enforcement partners who can help restore their good name, protect their financial security , and give the FTC the information they need to stop fraud.

Analysts say the rise of phishing, which evolved from a relative rarity to become one of the most common forms of spam e-mail in 2004, suggests that online identity theft is still increasing.
Consumer awareness is helping, as consumers are becoming smarter about not becoming victims themselves.

Still, if the problem is not curtailed, it will become an impediment to continued growth of e-commerce and the hopes for spreading commerce to mobile devices. Law enforcement is, by nature, an after-the-fact response, one that often happens well after the original theft takes place.

Online merchants can address the situation by beefing up their own security. Consumers say they're willing to endure more security measures, including those that go beyond typical password security, in order to ensure online transactions remain safe.

A trusted third party like Guardian eCommerce can also help consumers identify trustworthy Web sites.

In addition to ID theft and auction woes, top sources of consumer complaints to the FTC last year included those relating to computer or Internet services, scams relating to foreign money exchanges, work-at-home business opportunities and fraudulent loan or credit protection schemes.

More information at Guardian eCommerce Consumer Alerts.

Guardian eCommerce, as you may know, is dedicated to exposing trustworthy sites on the Web for online consumers worldwide. However, Guardian eCommerce also exists to meet the needs of online business too, like helping to increase online sales through the privacy seal program.

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More information at Guardian eCommerce.