eBay

pierrelebel · ‎09-30-2014

eBay said on Tuesday that it would spin off its PayPal payments unit into a separate publicly traded company, taking a step the activist hedge fund magnate Carl C. Icahn first demanded nine months ago.

The move will cleave eBay almost in half, separating it from the payments processor it acquired 12 years ago and built into a giant that generates almost half of the company's revenue.

The spinoff is expected to be completed in the second half of 2015. John Donahoe, eBay'€s current chief executive, will step down from that role once the separation is complete, and would serve on the board of at least one of the two companies.

http://finance.yahoo.com/news/ebay-spin-off-paypal-adopting-110014208.html

pierrelebel · ‎09-30-2014

From eBay.com Announcement page:

Today, eBay Inc. announced it will create two independent public companies—eBay and PayPal—in the second half of 2015. This will ensure each business is best able to serve its customers’ needs and thrive well into the future. You can read more about it here at ebayinc.com.

The creation of independent eBay and PayPal businesses will take up to 12 months to complete so this has no immediate impact on your account. Likewise, you can continue to count on everything you expect from eBay today. Innovation, value, trust, selection, and global reach will remain central to our business. And we will continue to work closely with PayPal to ensure payments remain a seamless part of the eBay experience.

As an active customer, you help make eBay what it is. eBay has always been more than a store. It is a community of people—buyers and sellers—connecting around the world. Thank you for being part of this amazing community. As we begin this next chapter of the eBay story, you have our commitment to make sure people like you remain at the heart of everything we do.

We are excited by the opportunity ahead and look forward to working with you in the future.

http://announcements.ebay.com/2014/09/ebay-inc-to-create-two-independent-public-companies-ebay-and-p...

greenmangoes · ‎09-30-2014

What does this mean for buyers/sellers - what are the pros and cons?

You only fail when you don't try!

pierrelebel · ‎09-30-2014

Much too early to tell.

For example: eBay and PayPal will have to change their buyer protection programs to eliminate the current stupid situation where a buyer makes a claim against the seller on one site if the purchase took place on eBay.com and a different site if the purchase took place on eBay.ca. Sellers have no control or knowledge of the site used by buyers.

Purchasing of postage from Canada Post (on eBay.ca) or USPS (on eBay.com) is currently administered by Pitney Bowes and payments collected by PayPal. Interesting to find out how eBay will operate a year from now. Will sellers be given a choice of payment method other than PayPal when purchasing postage?

The Global Shipping Program may also require retooling.

Etc... etc...

Is eBay planning to buy another payment system (like Billpoint fifteen years ago) to incorporate within its system and compete with an independent PayPal for collection of payment?

So many possibilities.

Personally I think eBay management is making a long term mistake by dividing the two operations but shareholders can only think of "what is good for me today" and seldom care about the long term picture (despite claims to the contrary by management). At the opening of trading on the stock market this morning, the value of eBay increased by billions of dollars (on paper). That is what most shareholders care about.

rose-dee · ‎09-30-2014

@pierrelebel wrote:

Personally I think eBay management is making a long term mistake by dividing the two operations but shareholders can only think of "what is good for me today" and seldom care about the long term picture (despite claims to the contrary by management). At the opening of trading on the stock market this morning, the value of eBay increased by billions of dollars (on paper). That is what most shareholders care about.

It's pure speculation of course (sometimes speculating is just fun), but could it be that eBay needed the "divorce" in order to enter into a new "marriage"? Not necessarily buying another payment system, but being bought by, or merging with, another player in the online commerce field -- Alibaba perhaps?

Either way, 2015 will be an interesting year in eBayland.

pierrelebel · ‎09-30-2014

If there is a new marriage in 2015 or 2016, I suspect it is PayPal who will remarry quickly (not eBay).

Discover and American Express come to mind.

Or an independent PayPal may be acquired by one of the big guys needing an effective payment system with over one hundred million registered members.

The winners are the shareholders. Nobody cares about users (buyers or sellers). We are irrelevant to this story.

mr.elmwood · ‎09-30-2014

Alibaba would probably like a payment system that is up and running, to partner with. Partner with eBay? Not so much.

eBay states they have 149 million active IDs. Those IDs bring transaction fees to PP.

eBay shares will go down and PP will have a high value. Who gets the money from the PP sale? How does eBay piece-off eBay shareholders who are going to lose value? Who will buy PP, eBay? Who will be the controlling stock holder, eBay?

eBay still has $17 billion in the bank.

This is about money, it sure isn't about you and me.

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rose-dee · ‎09-30-2014

@pierrelebel wrote:
The winners are the shareholders. Nobody cares about users (buyers or sellers). We are irrelevant to this story.

You've summed up in a nutshell why the corporate system is broken -- and almost imploded in 2008.

Where are the corporate leaders with the courage to look at the long game and serve both the shareholders' and the users' needs? Have they all taken their golden parachutes and gone off to live on their estates in Florida (or wherever)?

From a purely logical viewpoint, making fast money by playing a shifting shell game may be good in the short run for a limited number of shareholders, but ignoring the needs and desires of users will simply mean those users may eventually abandon the site/service in question and go elsewhere.

Then all those shareholders will have to look elsewhere too, for their quick profit fix. Whatever happened to the concept of steady growth based on integrity? Or am I just becoming too old to "get it", to understand this world of instant gratification and immediate reward?

tobyshitzu · ‎09-30-2014

alipay is already bigger then paypal

greenmangoes · ‎09-30-2014

I watched Jack Ma, founder of Alibaba on 60 minutes - the Three Keys to Alibaba's Success

* customers first
* employees second
* and shareholders third.

Ummmm ....

You only fail when you don't try!

art-in-the-making · ‎09-30-2014

"alipay bigger than paypal"

noted

although, there are 20 bridges in China longer than the Confederation Bridge - but no one could name a single one without looking it up and definitely none of them will ever take you to PEI.

art-in-the-making · ‎09-30-2014

* customers first
* employees second
* and shareholders third.

This goes back to what Rose-Dee said.

Our prevailing capitalist system is dysfunctional and degrading itself - perhaps slowly, perhaps more quickly than we ever imagined. We have seen how quickly the bottom can fall out of the price of oil - or how quickly the value of companies like Google or Apple etc can explode.

The business logic that forces corporations to put shareholder interests first is growing more anti-competitive and friendlier towards operations mediocrity.

The meltdown may come in a surprising fashion, though. "Profitable" but complete operations failures (Toronto Maple Leafs always the best example) could lead the way into collapse, but who knows, our economic system may be turned upside down by some new class of business whose value skyrockets so high so fast that all other businesses are rendered worthless.

rockp5233 · ‎09-30-2014

* customers ; Need someone to get the money from
* employees ; Need someone to get the job done
* and shareholders : Need someone to GIVE the money to

That what Jack Ma means by the 3 keys of Alibaba...

brandeentertainment · ‎09-30-2014

This is all I saw when i read the article

The benefits of the existing relationships between eBay and PayPal will naturally decline over time and can be optimized in arm’s length operating agreements between the two entities. Arm’s length operating agreements can formalize the existing relationships between the two companies and capture ongoing synergies.

no really sellers gonnna have to go through another 1 million changes now.. Way more then ever before I would suspect...

hold on to you knickers

cumos55 · ‎09-30-2014

Paypal handles a lot of money..... and if I remember correctly...

Paypal is not classified as a bank... and....it does not fall directly under any form of government regulation/control.

Paypal is in many countries.... and all it takes is for one country to impose some form of regulation on Paypal....

and other countries may/would follow.

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It is to the advantage of eBay and Paypal... to be separate... and ... together....in the future.... However, it is Paypal that will benefit the most by being a corporation separate from eBay

If anything.... Paypal's future was restricted by its being a part of eBay....

Once separate, Paypal can establish relationships without causing problems ... conflicts... for eBay

rose-dee · ‎10-01-2014

@brandeentertainment wrote:
This is all I saw when i read the article

The benefits of the existing relationships between eBay and PayPal will naturally decline over time and can be optimized in arm’s length operating agreements between the two entities. Arm’s length operating agreements can formalize the existing relationships between the two companies and capture ongoing synergies.

no really sellers gonnna have to go through another 1 million changes now.. Way more then ever before I would suspect...

hold on to you knickers

No kidding!

We have to hope that it won't be Paypal who will ultimately dump eBay and its operating agreements to capture "ongoing synergies" (whatever the heck that means) at some point along the line, or at least make it more costly for eBay sellers to use.

pierrelebel · ‎10-05-2014

Opinions - Yours may differ.

eBay and PayPal are breaking up - what does it mean for sellers? Comments from sellers as collected by AuctionBytes:

http://www.ecommercebytes.com/C/abblog/blog.pl?/pl/2014/10/1412453509.html

Also:Ramifications of the eBay PayPal Breakup for Sellers

http://www.ecommercebytes.com/cab/abu/y214/m10/abu0368/s02

mr.elmwood · ‎10-05-2014

Well, lemmee summarize that last one. eBay will fail, succeed, stay the same, increase fees, decrease fees, re-invent, not re-invent.

Nice to have that all cleared up.

Under JD, eBay grew tremendously. They have made buckets of money. I made buckets of money, well, small buckets, but I did well enough. My profits went up and my costs went down. Now, thanks to money markets, that is being further enhanced with the diving Cdn dollar.

The only thing constant about change, is change itself. By the time this really shakes out, we will be deep into 2016, I predict 2017.

One aspect of that article that I had not considered is that eBay is the portal for getting new customers into PP. PP was made into what it is because of eBay.

PP fees, in the future, seem to be staying the same. They are in line with others, or, others are in line with them. It is hard to tell who is leading.

eBay will change, it always has. I am considering how it will change. What that means to me. Right now, it almost doesn't matter what they do as they can use loss leaders to get people into the PP system. Loss leaders include free listings.

Hum? I predicted, year and a half ago, that free listings would "go away". I have been postulating for a while that eBay would go to a full user pay model. Ya don't figure this eBay PP split has been in the works for at least a year and a half, do yer?

eBay has been doing their due diligence. They know who generates the revenue in the system. hey have been enhancing the benefits to store subscribers. They have been limiting those who utilize free listings. The gap has been growing. eBay knows how much I have paid and how long I have been paying. They know who has not been subscribing.

When eBay is split off, and yes, it is eBay not PP that is being cast off, who is the new management going to look at first? The users who pay up front or the ones that do not pay?

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