Investors hoping for a recovery in Angie's List (NASDAQ:ANGI) may be in for a disappointment, Fool contributor Tim Beyers says in the following video.
What's the problem now? eBay (NASDAQ:EBAY). After a successful trial run in the United Kingdom, the auctioneer has decided to launch "eBay Hire" here in the U.S. Like Angie's List, the service is designed to put shoppers together with local service providers who list their services, bio, and rates.
eBay doesn't plan to charge for "Hire" in the first few months of the life of the service, TechCrunch reports. That should change once there are enough service providers and consumers tapping the service, at which point eBay plans to levy a transaction fee similar to what users pay when auctioning products in the online marketplace.
Can Angie's List endure the assault? Tim cites two reasons to be pessimistic. First, eBay already serves hundreds of millions of registered users versus just 2 million Angie's List members. Newbies with a need to find a reputable contractor are more likely to try eBay. Second, Angie's List is already cutting prices in what looks like a response to stiff competition. There's no evidence the company enjoys a sustainable competitive advantage, Tim argues.
Do you agree? Are you willing to give Angie's List the benefit of the doubt? Please watch the video to get Tim's full take and then leave a comment to let us know where you stand.