With rivals like Amazon.com turning up the heat, eBay's e-commerce prowess has waned, as both buyers and merchants seek new alternatives in online shopping.

In 2008's fourth quarter, the Marketplaces unit saw its revenue decline 16 percent, compared with the same quarter in 2007, while gross merchandise volume declined 12 percent. Unique monthly users also dropped year-on-year.

EBay began strictly as an online auction site but has since become more diversified, allowing the sale of fixed-price items and letting merchants open "stores."