[pyweed]

The concept of holding feedback hostage has its origins at a time when sellers could give buyers negative feedback. Some sellers withheld feedback until they received positive feedback. That way if there were any complaints they could retaliate and then solicit feedback withdrawal. Some sellers excused this practice on the grounds that "the transaction isn't completed until I'm certain that the buyer is satisfied," but in reality it was an unethical practice designed to bully buyers into not reporting problems.

eBay recognized this growing problem and eventually made it impossible to provide negative feedback for buyers. This was a highly controversial move that set the message boards aflame, but there is no question that it was successful in eliminating this form of seller intimidation.

Because buyers can no longer receive negative feedback the term "feedback hostage" is no longer very meaningful. It's sometimes used to describe the practice of a seller waiting for positive feedback before reciprocating. This practice is illogical and self-defeating under the current system, but it doesn't constitute feedback hostage, and as jsh points out, there's nothing unethical about it.

I encourage sellers to provide immediate feedback upon payment if they can because (a) buyers like it, (b) it's harmless, and © some buyers are really hung up on it. Sellers who subscribe to Selling Manager Pro can provide automated positive feedback upon payment, so some buyers have come to expect it. It's like an immediate "thank you." If you don't provide it, you may end up compared unfavorably (right or wrong) with sellers who use automated feedback.