*This post is an abridged version of a presentation given at the Law Seminars International “Mobile Payments Law” conference on November 22, 2013.
An “online marketplace” is a website that facilitates transactions between third party buyers and sellers, rather than between customers and the website itself. eBay was an early pioneer in this business, followed by Amazon Marketplace, Etsy, and a host of others.
Marketplaces occupy an ambiguous place in the supply chain for goods and services. Marketplaces connect buyers and sellers. They differ from online stores, which buy and sell in their own names. Some marketplaces maintain their distance from the supply chain and provide little more than passive hosting services for online advertisements. Other marketplaces curate buyers and sellers, deliver digital goods, or guarantee buyer satisfaction. Many marketplaces provide payment services so that buyers can pay sellers on the website.