PayPal - what are they thinking?!

Over the last couple of weeks, Paypal has had a number of technical glitches, mini outages, etc.  Sellers in generally continue to have intermittent issues accessing their accounts, downloading bills, and generally experience flakiness you never like to see from your payments vendor.

PayPal's reaction:

1. They've launched this "online merchant network" seller community thing that is really weird to me.  It looks like a marketing thing where they want sellers talking about paypal.  The first thing I noticed is that the login is not ENCRYPTED.  This creates a dangerous scenario.  What are most users going to use as their user id and passwords when the got to a paypal oriented site?  You guessed it, their paypal information.  This will be transmitted free and clear over the internet.  A half intelligent phisher will be on top of this. 

My recommendation to eBay strategies readers: stay as far away from this site as you can, wait for there to be some SSL encryption deployed before you ever login.  This is Web site development 101 here folks. It says powered by "Lithium", um ok, I guess that explains it?!

2. Then today techcrunch's Michael Arrington has news on a new Paypal feature they've discovered that appears to be in beta called PayPal Drop Box.  This looks to be a merchant feature where you can upload files securely (I guess lithium is not involved) to Paypal and store them there.   It's early so this could actually be somehow related to payments - e.g. you could upload/download files for processing from your dropbox (like the offline analog where retail businesses clear the till and drop off the receipts at the local banks dropbox).

What these moves have sellers asking, much in the same way as parent eBay's wanderings into Wikis/blogs/myworld - "Hey guys, lets work on the core business here!  I'm spending $X/m with you, invest some of that in the stuff I use every day instead of this fringe stuff."

Readers -what do you think?