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Which is better to use? The eBay API or eBay File Exchange?
File Exchange is a batch-oriented system which allows you to list and revise items on eBay.
For example, assume you want to list a number of items on eBay. To use File Exchange, you first enter in a spreadsheet-format file the items you want to list for sale on eBay. In the sheet, you provide information similar to the API's AddItem call -- for example Category, Title, and Shipping Services.
You then upload the sheet using either a web-based interface that eBay provides, or by making HTTP POST requests to https://bulksell.ebay.com/ws/eBayISAPI.dll?FileExchangeUpload. You can also download results via HTTP GET requests. To programmatically upload or download files, you will need a separate security token. Programmatic access is outlined here.
In general, the API provides more calls and more flexibility than File Exchange. However, eBay File Exchange may be useful for large bulk adds or revisions as the File Exchange protocol is less "chatty" for each insertion or revision.
eBay File Exchange Overview
eBay File Exchange Advanced Instructions