Online auctions were supposed to be the next big thing. At least that's what people thought in the dot-com boom, when eBay (EBAY) was full of promise.

What happened over the last decade? Now, even eBay doesn't care much for online auctions (they make up 31% of sales on the site) and the very concept of bidding for something over the computer seems to be dead, writes Wired Magazine.

EBay has gone from being an auction company with a payments business (PayPal) on the side to being a financial company with an auction business on the side. PayPal is growing like a weed, and brought in $3.4 billion in revenue last year.

EBay still runs auctions, but most of those go through the fixed-price "Buy it Now" option that eliminates the need for bidding.

"Today online auctions are a niche service, whereas a decade ago it seemed to many as if they were going to transform the way everything was bought and sold," writes Wired's James Surowiecki.

He lists a few reasons why online auctions veered off-course. I'll add a few of my own reasons as well:

--Sniping. This is where people wait until the very last second to jump in with a bid, hoping to score a win before any other buyers have a chance to respond. I have been the sniper and the snipee on eBay, and trust me, it's no fun to think you have the lock on something only to find it ripped from your hands in the final seconds.

--Prices. There aren't many bargains to be found anymore. At least not compared to the glory days when eBay felt like it was part garage sale, part swap meet.

--Less variety. Competitors like Amazon (AMZN) and Google (GOOG) have given sellers other avenues to pursue, causing some of the more unusual or rare items to slip out of eBay's realm.

--Bidding isn't as novel. Hunting for online treasures isn't really as new anymore.

--Skewed shipping prices. Some sellers bumped up their shipping costs and dropped their starting prices, handing a rude surprise to buyers who forgot to check those costs out.

--Alienated sellers. The company changed its policies for sellers too many times, upping fees and making it more difficult to sell. Many frustrated sellers threw up their hands and headed for Amazon and other rivals.

--Counterfeiting. At The Big Picture blog, Barry Ritholtz says counterfeiting helped doom the online auction. "For a time, there was a robust trade in higher priced, name brand goods," he writes. "Then the counterfeiters came along, and whether it was 1000 count Egyptian Cotton sheets or Tommy Bahama swim trunks, buying on eBay became an exercise in uncertainty."

--Paypal. Ritholtz also hates Paypal, saying he has had horrible personal experiences with the payment service. I've never had any problems with Paypal.

Don't write off eBay yet, however. The site still handles billions of dollars in auctions every year. Its momentum may be off, but eBay's legacy has inspired other online transactions, Surowiecki writes. "Sites like Groupon, LivingSocial, Gilt Groupe, and eBay’s own StubHub are all companies that, in a broad sense, are built on the concepts that made eBay so successful: the flexibility of prices, the importance of network effects, the value of empowered consumers."