eBay Sells Off After Facebook Launches Marketplace

eBay Inc (NASDAQ: EBAY) shares were down about 2 percent as traders were alarmed by competitive threat from an unexpected quarter.

Facebook Inc (NASDAQ: FB) is introducing Marketplace – a destination to discover, buy and sell items with people in your community. Now, isn't that encroaching into someone else's territory?

The social networking giant also said it would continue building on options and features to provide rich user experience.
To access Facebook's Marketplace, once has to tap on the shop icon at the bottom of the Facebook app. The Marketplace displays photos of items of listed for sale. It also provides filtering options to short list products by location, category or price. Once you shortlist, a mere tap on the product gives additional details like product name, description, profile of the seller and their location.

Marketplace will be available in the US, UK, Australia and New Zealand for iPhone and Android. The company also said it would roll out the service to more countries in the coming months, with a desktop version of it also close at hand.

Does Facebook Have An Edge?

With Facebook ruling out the role of a e-retailer or an auction site, it could lure people seeking to list without any charges. Facebook's user statistics could give eBay some sleepless nights. As of second quarter of 2016, the company had 1.71 billion active users. Though a newbie in the arena, these advantages could give the company a head start and position it on track to eventually pose a credible threat to the likes of eBay.

eBay traded recently at $32.31, down 1.8 percent.