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I have never used a sniping service and definitely don't know how they work. But it sounds to me from what I have read in this thread that they submit a single fixed bid at the last second. Is this correct?
The eBay proxy bidding service, which I use routinely, is a "set and forget" kind of thing. You tell it the maximum bid you are willing to submit and it watches the bidding for you electronically, including the last few seconds, and submits progressively higher bids up to your maximum bid.
If a sniping service (or multiple sniping services) submit one or more bids at the last second the eBay proxy service will still outbid it if the bidder using the proxy service's maximum bid is higher than the sniper's bid.
Yes, this is right. But the snipe service is no more trouble than the proxy bid, and has the advantage of not driving up the bid price. Entering a max bid at the last second is the same as entering one earlier on, only without giving other bidders the time to drive up the price/get mad at being outbid/decide they're willing to pay more/etc. You won't pay any more by sniping, and quite possibly will pay less.
I can't tell you how many auctions I've seen where someone, usually a newbie to eBay, enters 10 or more bids in small increments until they become the high bidder. Then they get outbid and the process starts again. Clearly such folks don't have a reasonable maximum in mind, and I don't need such folks driving up the price. Unless I'm the seller, of course. Then I'm all for it.