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PayPal's outages disrupt eBay auctions

X.com's money-transferring service snarls hundreds of auctions after a system upgrade causes the site to go down.

Greg Sandoval Former Staff writer
Greg Sandoval covers media and digital entertainment for CNET News. Based in New York, Sandoval is a former reporter for The Washington Post and the Los Angeles Times. E-mail Greg, or follow him on Twitter at @sandoCNET.
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Greg Sandoval
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X.com's money-transferring service, PayPal.com, has been up and down since Monday morning and has snarled hundreds of auctions as a result, according to users and a spokesman for leading auction site eBay.

X.com's new chief executive, Elon Musk, said that technicians fixed the configuration problems that caused the bottleneck yesterday at about 4:30 p.m. PT. On message boards at eBay and the portal Auctionwatch, customers of Palo Alto, Calif.-based PayPal voiced their displeasure over their inability to access the site. Auction buyers could not pay their bills and sellers were unable to access the payments they received.

"I do eBay as a full-time job," wrote one person who posted a message on Auctionwatch. "If it were just a hobby I would not be as upset, but I have bills to pay and haven't been able to touch any of the money in my account?I am so frustrated and fed up with PayPal right now."

PayPal is a person-to-person payment service that allows users to send money via email. Since January, the site has grown from 10,000 users to 1.6 million and is set to send more than a billion dollars this year. Bill Harris, the former chief executive of business software maker Intuit, was asked by X.com's board of directors to resign as its chief executive last week. Musk, who replaced Harris, said that 31 percent of all eBay auctioneers use PayPal.

"We've been working night and day to make sure the system is working properly and that this never happens again," Musk said. "We are growing very quickly, and for the most part, we've been able to keep up with it. When things have slowed down, we've moved quickly to correct them."

A laundry list of Web sites, including Toysrus.com, eBay and tax site hrblock.com, have buckled under sharp spikes of traffic. Analysts warned that preventing outages is paramount if they want customers to keep returning to to their sites.

On Monday, PayPal said that while technicians were upgrading its computer system, a configuration glitch took place. Many customers trying to log on received error messages or a message from PayPal notifying them of the system's problem.

PayPal user Gaylan Page told CNET News.com that since he became a PayPal user a month ago, he completed eight transactions, but was unsuccessful using the site for a full two days this week.

"It's one thing when a typical information type Web site has problems," Gaylan said. "But when one handling money transactions hiccups, I get a major case of heartburn."