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A new service introduced Wednesday allows eBay bidders to receive wireless alerts when they are outbid on auction items and to quickly rebid via a cell phone equipped with SMS (Short Message Service).

Wireless Rebidding for eBay is run by InPhonic, a Washington, D.C., wireless software and services firm. Priced at $2.99 per month, the service includes unlimited auction alerts and bid placements, along with optional news, sports, weather, and other informational alerts from a variety of content providers. Major carriers and many regional ones in the United States and abroad support the service, according to InPhonic. These include AT&T Wireless Services, Verizon Wireless, and Sprint PCS Group in the United States and Vodafone Group PLC and NTT DoCoMo internationally. Also supported are most handheld wireless devices, including Research in Motion's BlackBerry and handhelds from Palm and Handspring

InPhonic Chief Executive Officer David Steinberg said the catalyst for the service was his own frustrating attempt to up his bid for a painting on eBay.

U.S. Opening for SMS?

"We see eBay as the absolute best product on earth for this system," Steinberg said, citing the auction site's "fanatically loyal" user base and strong management team.

SMS hasn't caught on in the United States as it has in Europe and Asia, acknowledged InPhonic Vice Chairman John Sculley, formerly CEO of Apple Computer.

"(EBay) is a well-developed franchise, and this is a system that brings value to people who already understand the value of doing online transactions," Sculley said. "We think that's one way to start building critical mass for SMS (in the U.S.)."

Keeping it Simple

EBay has previously dipped its toes in the wireless waters: Several years ago it teamed with Palm on an application allowing Palm VII users to wirelessly place and track bids. That service wasn't very successful, said eBay representative Brian Cowley.

"EBay users like simplicity. We think InPhonic is going to be a lot easier," Cowley said.

International eBay users can tap into InPhonic's rebidding system, but must navigate InPhonic's English-only sign-up interface and pay with a U.S. credit card. InPhonic is working on translations of its sign-up site and billing arrangements to allow international customers to more easily use the service, Steinberg said. Also in development is a voice rebidding system, using voice XML (Extensible Markup Language), to let users increase bids without using SMS.

That voice service is at least two months away, and will likely carry additional per-transaction costs beyond the InPhonic service's monthly fee, Steinberg said.

The XML system underlying the InPhonic service can be easily recycled for other, similar offerings, according to Steinberg, who said the company intends to extend the service through other partnerships. For instance, a frequent traveler could subscribe to an SMS notification and instant rebooking service to flash alerts about delayed or cancelled flights, he suggested.

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