EBay sets up affiliate network, hurting ValueClick

SAN FRANCISCO Mon Mar 17, 2008 7:52pm EDT

Meg Whitman, eBay President and CEO, delivers the keynote address at eBay Live! in Boston June 14, 2007. REUTERS/Katie McMahon

Meg Whitman, eBay President and CEO, delivers the keynote address at eBay Live! in Boston June 14, 2007.

Credit: Reuters/Katie McMahon

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SAN FRANCISCO (Reuters) - EBay Inc has set up its own affiliate network to encourage Web sites to drive traffic to its eBay and Half.com Web sites, reducing its reliance on ValueClick Inc's network.

In a statement on Monday, eBay said the online auctioneer and Half.com will no longer run their affiliate programs through ValueClick's Commission Junction platform but instead rely on the San Jose, California-based company's own newly created eBay Partner Network.

Shares of ValueClick closed down 7.3 percent to $16.20 on Nasdaq after eBay disclosed the move. EBay stock fell 1.8 percent to $25.77 amid broad declines in the sector. The AMEX Internet Index closed down 2.3 percent.

EBay's Tradera AB, ProStores, Inc; Reseller Marketplace; Media Marketplace; eBay Stores; and StubHub will continue to rely on Commission Junction to drive traffic to their sites. EBay affiliates working with other affiliate platforms, including Affilinet and Tradedoubler, will not be affected.

The changes take effect April 1, 2008, eBay said. Affiliates affected by the changes must move to the eBay Partner Network by May 1, the online auction leader said.

Since 2001 eBay has allowed affiliates and Web site publishers to be paid for driving Web surfers to eBay. eBay's Affiliate Program has more than 100,000 members globally.

(Reporting by Eric Auchard, editing by Richard Chang)

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