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EBay Thinks Google Mojo Is Stinky 
By: SearchNewz Staff 2006-06-09 What John Battelle says is obvious isn't obvious to everyone. But its nice when he sheds some light for the unsuspecting. Google and eBay's relationship up to recently has been quite symbiotic, but as the online auctioneer is increasingly threatened by Google's "cross-mojonation," the "obvious" choice was to take Google head-on.
Everything was going swimmingly. Google was driving a ton of traffic eBay's way, eBay was Google's biggest advertiser. Froogle and Google Base open up and eBay says "wuh-haaa?" The last straw? No, just a heavier burden, another competitor to add to the pile. But then, after months of the Google PR team refusing to discuss "speculation" about up coming services, folks get wind of GBuy, the impending nemesis of eBay's PayPal. Battelle, quoting some industrious and exhaustive students, gives us this insight: Based on our high level projections, we can foresee a mismatch between demand and supply that could possibly induce some price pressure on Google's core ad market. Moreover, in order to reach revenue levels built into Google's valuation, Google will have to enter markets outside of online ads."
And hence, all the vertical movement (cross-mojonation). But also, it spurs deals between eBay and Yahoo! to punch Google in the gut for it, because they read Forbes writers and analysts calling GBuy "revolutionary." And it could be, too. The market responded quite favorably upon the news of the PayPal competitor. Part of the "outperform" rating stems from core search results that will come with "trusted GBuy merchant" labels for participating stores. This, says RBC Capital Markets, should ultimately increase click-through rates as well. As the competition heats up, it should be interesting to watch strategies unfold and some creative jockeying as mojos cross. But don't expect that eBay and Google want to kill each other quot; in the end, they need each other quite a bit. About the Author: One of the many staff writers covering the search engine industry for SearchNewz.com. |
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