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Online auction firms raising ante

Responding to competition, online auctioneer Onsale splits its offerings into two sites, one for selling consumer electronics and the other for computer products.

Responding to competition, online auctioneer Onsale (ONSL) split its offerings into two sites today, one for selling consumer electronics and the other for computer products.

The consumer electronics site represents a first step in Onsale's strategy to expand its scope beyond computer goods, the company said. The new sites go live today at 3:30 p.m. PT.

New competition comes from FirstAuction, a project of TV giant Home Shopping Network's Internet Shopping Network. FirstAuction, which launched last month, also sells computer and consumer electronics products; it also expects to generate more than $30 million in revenues in its first year, according to ISN chief executive Kurt Loevner.

Another Net auction entrant, bidnask.com, launched in May but has suspended trading, according to a notice on its Web site.

Onsale intends to launch other auction sites in new product categories, according to Jerry Kaplan, Onsale's chief executive and cofounder. Splitting its site reflects Onsale's view that the new category could not be handled adequately in a single Web site.

Onsale's auction site, which has sold computers, peripherals, scanners, cordless phones, stereo systems, power tools, and housewares, sometimes produces bids above average retail prices as buyers get caught up in the auction mentality.

Marketing tests showed Onsale's bidders were interested in the consumer electronics as well as computer products, and Kaplan added vendors were amenable, too.

Onsale bidders make their offers at the firm's Web site, and the Web pages for particular products (several identical items are typically sold simultaneously) are updated automatically. Bidders can increase their bids via email or returning to the Web site. Winning bidders are notified by email or on the site itself.

For the quarter ended June 30, Onsale reported sales of $24.5 million, including consignments. Auctions are run weekdays, and tens of thousands of items are posted in a typical week.