The eBay, PayPal, and Google Fight Club - Fight Club
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So who threw the first punch? With the introduction of eBay’s own ad system a few months ago, many speculated that eBay was attempting to rival Google’s AdWords system with the introduction of the contextual system in June. According to a Reuter’s report, eBay plans to provide hundreds of thousands of eBay auctioneers with simple snippets of code they can embed on other web sites that showcase items that are for sale on eBay's site. The system scans the text of a web site for keywords and returns links to relevant eBay sales listings to the web page. As listings change on eBay, advertising dynamically changes on affiliated web sites to reflect the new products or services for sale on eBay.
Once the system is in place, however, it is not a stretch to predict that eBay will seek to further monetize its technology and network of partners by opening up the system to any advertiser and any web site, much like Google does with its AdSense.
Shakeup or Shakedown?
There also seems to be a flurry of activity over at PayPal, eBay, and Skype during this Google Checkout stand-off. Jeff Jordan, long-time president of PayPal, is leaving the company this fall, as stated in a press release from eBay last week, to be replaced by Skype’s president Rajiv Dutta.
Ina Steiner of AuctionBytes.com reports, “Dutta has been with eBay since 1998 and served as eBay's Chief Financial Officer and head of strategy from 2001 through 2005. Alex Kazim, Skype Vice President of Products, will assume the role of President of Skype, reporting to Skype CEO and founder Niklas Zennstrom. Kazim, formerly Senior Vice President of new ventures at eBay, has held leadership positions in all of eBay's businesses and was responsible for launching eBay's international classifieds sites, Kijiji.
“PayPal's Jeff Jordan, who joined eBay in 1999, was considered by many as a possible successor to eBay President and CEO Meg Whitman. Jordan led eBay North America from 2000 through 2004 and was named President of PayPal in December 2004.”
One has to wonder about the timing of the press release about the shakeup in light of the Google Checkout launch. And while we can speculate all we like, neither side is talking.
Will Google Retaliate?
So far, Google has not had much to say about being banned on eBay, or about the possible rivalry over eBay’s contextual ad system. But it doesn’t seem wise that Google retaliate in any way, as eBay is one of Google’s biggest AdWords customers. We should keep watch to see if any eBay ads on Google seem to drop for particular keywords, or if eBay ads disappear gradually, if at all.
But at this point, the ball is definitely in Google’s court, and it is up to Google to throw the next punch in order to continue the fight. However, since this latest move on eBay’s part simply looks bad for them, it may be exactly what Google had planned in the first place: make eBay look like a scared puppy, and let them make it worse on their own, and in turn, give Google Checkout the kind of publicity you just can’t pay for these days.
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