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EBay to Spin Off PayPal

dealbook.nytimes.com

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Re: EBay to Spin Off PayPal

#81

Post by CamperBob2 »

ghobs91 wrote: post #80

I think one of the major sources of eBay's troubles is their decision to slowly abandon their P2P focus, in favor of the "shopping mall of the internet" model that Amazon uses. Rather than pursuing this model and doing it better than the competition, they chose to ape them, and badly. Like CrazyCatDog said, eBay is the textbook example of what happens when a tech company is run by consultants who don't understand the…

A contrarian view: there is some room to attack Amazon, primarily in the UX department. I wouldn't rule that out as a strategy for growth, but is eBay the right company to execute it? That's where it gets murky. They have a lot of the same usability flaws.

Re: EBay to Spin Off PayPal

#82

Post by skinnybatch »

lnanek2 wrote: post #17
ghshephard wrote: post #4

The first thing that comes to mind is that the clock has just started ticking for PayPal to become accepted all over the web in places that it may not have been as welcome. For example, I'm sure Amazon will add PayPal within 90 days of Paypal going public (if not sooner).

Amazon has their own payments solution. I've actually seen it replacing PayPal several places, like buying WiFi on flights.

Let's hope that the competition between Amazon and PayPal results in some significant value for the consumer/user/business users. Years ago, when I first built my e-commerce site, the only viable payment method that could be easily integrated was PayPal. Unless I wanted to pay a significant premium to have a payment gateway before I was ready to take on those initial sunk costs, PayPal was the most attractive and likely solution.

Hopefully, the industry will shift as more options become available and user-friendly. PayPal has the advantage of name recognition, but Amazon shares the same, and frankly, I personally regard Amazon more positively than PayPal. Hopefully, the industry continues its trend, now a quasi-oligopoly and eventually monopolistic competition.

Like others have mentioned, I too wonder how they are going to divvy shares.

Re: EBay to Spin Off PayPal

#83

Post by CamperBob2 »

wheaties wrote: post #2

Wait, payment processing is seeing a lot more competition and now they decide to split? I don't know if this is such a "value creation" move.

I think the argument is that as the landscape gets more competitive, eBay can't afford to tie themselves so intimately to a single payment provider.

That is why eBay's stock lurched upwards as soon as the news was announced. To someone looking to invest in an online marketplace, eBay is more important than PayPal by itself.

Re: EBay to Spin Off PayPal

#84

Post by venaoy »

DanBC wrote: post #10
conchy wrote: post #7

Smart move, eBay divests before bitcoin really starts eating PayPal's lunch

Bitcoin provides zero protection to buyers. It's delusional to think people would want to buy stuff from ebay without the protections from Paypal or their credit card provider. Current consumer protection advice is to walk away from any sale that uses things like Western Union or cash transfer - and this is likely to be extended to include Bitcoin as soon as anyone in the general public hears about Bitcoin.

And credit cards provides zero protection against identity theft. In fact, they even enable it because you give your full billing info (credit card number, address, etc) when paying an online merchant with a card.

You see, no payment technology is perfect. Credit cards have flaws. Bitcoin has flaws. But Bitcoin is better than credit cards for the average consumer. In the last 10 years:

- I have had to deal with 2 identity theft incidents that caused me major hassles and waste of time. Bitcoin would have prevented this because a Bitcoin transaction authorizes 1 and only 1 payment to a specific address. Bitcoin utilizes cryptography to guarantee that, not blind faith in the merchant not being compromised by hackers...

- on the other hand I have never had the need to issue a credit card chargeback, so this protection of credit cards was, although real, unneeded, useless to me.

Re: EBay to Spin Off PayPal

#85

Post by DanBC »

CamperBob2 wrote: post #81
ghobs91 wrote: post #80

I think one of the major sources of eBay's troubles is their decision to slowly abandon their P2P focus, in favor of the "shopping mall of the internet" model that Amazon uses. Rather than pursuing this model and doing it better than the competition, they chose to ape them, and badly. Like CrazyCatDog said, eBay is the textbook example of what happens when a tech company is run by consultants who don't understand the…

A contrarian view: there is some room to attack Amazon, primarily in the UX department. I wouldn't rule that out as a strategy for growth, but is eBay the right company to execute it? That's where it gets murky. They have a lot of the same usability flaws.

I love to think that a web shop with decent search would beat Amazon.

However, even though I really freaking hate some aspects of the Amazon website I am a repeat customer. I don't have much money but the small amount of disposable income I do have goes to Amazon.

Competitors would need to have similar customer protection and customer service; and at least similar pricez or justification for higher prices.

Re: EBay to Spin Off PayPal

#88

Post by trhway »

CrazyCatDog wrote: post #45

When the going gets tough, firms call in consultants. When Bain or McKinsey arrive, they tell you to make a change. Is your firm centralized? Decentralize it! Is your firm decentralized? Centralize it. Donahoe's "master fix" and subsequent exit should give pause to industry thinking of hiring consultants to run their companies in the long-run; for as the saying goes: the apple doesn't fall far from the tree.

This is what they repeatedly did to collective farms mid 20th century in USSR. Nothing helped. One can only wonder why :)

Re: EBay to Spin Off PayPal

#89

Post by mathattack »

CrazyCatDog wrote: post #45

When the going gets tough, firms call in consultants. When Bain or McKinsey arrive, they tell you to make a change. Is your firm centralized? Decentralize it! Is your firm decentralized? Centralize it. Donahoe's "master fix" and subsequent exit should give pause to industry thinking of hiring consultants to run their companies in the long-run; for as the saying goes: the apple doesn't fall far from the tree.

Wasn't the prior CEO (Meg Whitman) also Bain?

In his defense, he was there for almost 10 years, no?

Re: EBay to Spin Off PayPal

#90

Post by mathattack »

ChuckMcM wrote: post #67
CrazyCatDog wrote: post #45

When the going gets tough, firms call in consultants. When Bain or McKinsey arrive, they tell you to make a change. Is your firm centralized? Decentralize it! Is your firm decentralized? Centralize it. Donahoe's "master fix" and subsequent exit should give pause to industry thinking of hiring consultants to run their companies in the long-run; for as the saying goes: the apple doesn't fall far from the tree.

Hilarious and on point, but to their credit consultants look at what you are currently doing which isn't working, and suggest you do the other thing on the theory that worst case that won't work either but at least you will have tried something new. I generally think that it is a symptom that the management isn't able to manage the business. Not everyone has the skill set to mix a tech and commerce company into a liv…

The "higher brand" consultancies also live by their stamp of approval.

A CEO who wants to do a risky strategy will hire the biggest brand name possible to provide cover. "Nobody got fired for hiring McKinsey for advice" is similar to "Nobody got fired for buying IBM hardware". And in this case, the CEO can say, "Well, I hired the best to help me think it up" when it goes wrong.

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