Friday, June 22, 2007

eBay and Google Checkout: What Next?

eBay Live is now over and the eBay-Google foofaraw also seems to have died down a bit...first Google planned the "Tea Party" (I"m still wondering what they would have done..thrown Monopoly money into the Charles River?), then canceled it after working things out w/ eBay, eBay pulls its ads from Google, a Google sympathizer is ushered out of the eBay Live gala, etc. 

(See Ina Steiner's blog post at if you want more on that.)

I've been trying to decide what to make of the whole thing. Different people seem to have completely different takes on the thing: on the one hand, most of the eBay seller-type folks who left their thoughts on an AuctionBytes phone poll seem to be of the opinion eBay should allow Google Checkout, it's being a mean monopolist, etc. (I'm paraphrasing but that seems to be the gist of things).

As as an eBay seller and buyer, it would be nice to have multiple checkout options for people and myself. As an eBay shareholder, I  think I can understand eBay protecting their turf. As a Google shareholder as well, I appreciate that Google is an incredibly competitive and innovative company. Should they be so aggressive with Google Checkout, however, or should they take more of a Ho Chi Minh strategy, and be patient for the long term?

Remember what happened with PayPal? eBay had its own payment system, Billpoint, and resisted embracing PayPal until it became clear it had gained so much momentum and was what everyone wanted to use.

At the eBay DevCon, early eBay investor Bob Kagle said of PayPal that eventually they decided they should look at buying the company, but at
first $300 million, it was too expensive, then at $700 million, it was
too expensive..."finally at a billion and a half dollars, we realized
it was cheap." This got a laugh out of the crowd.

Of course, this would not be a case of eBay buying Google Checkout. (At least I don't think it would).  But I wonder if Google Checkout becomes so popular and there are so many people clamoring for it, eBay will give in and accept it. But they may figure, why borrow trouble before then?

On the other hand, an analyst I recently met said "Checkout is doing everything possible to encroach on eBay's domain. Many people in the community state that if Google wanted to trounce eBay they would have opened up an auction site. Google sort of did with their Google Base."

"Again, this was a typical strategy of Google. Open up something under eBay's radar and state it is not in competion with eBay. Over time if it was successful, Google would have transformed it into an auction site. With all of the money eBay spent adertising with Google they could have purchased a very decent search engine."

He cites as one example.

I hadn't thought about eBay buying or developing a search engine, but it's an interesting idea. I have, however, seen all the eBay ads that popped up all over the place, and with some pretty obscure word combinations, when doing Google searches, and wondered if eBay wasn't maybe overspending a bit with the ads.

But one would  hope they are monitoring the results of the ads and not spending where it was not effective.

Hmm..will eBay buy a search engine? Will Google checkout encroach more on PayPal's turf? And what about Google Base? Is that going to gain momentum?

As the Chinese say, may you live in interesting times.

1 comment:

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