A surprise management shakeup at eBay Inc., resulting in the departure of a key executive considered a possible successor to CEO Meg Whitman, is raising eyebrows and concern among investors just as the online auction giant's business slows and competition from Google Inc. heats up.
All we can hope for is that politicians don't offer to "fix" the problem.
It seems this comes at a time when the battle for supremacy in the online payment system sweepstakes that involves Ebay, PayPal, Yahoo, Google and their new payment system, Google Checkout.
EBay's shares slid to their lowest levels since late 2003 on the double-barreled news that Jeff Jordan, the president of eBay's online payment system, PayPal, plans to check out in the fall and a Wall Street analyst's contention that Google's new online payment system poses a much greater threat to PayPal than previously thought.
And it's a high stakes battle too. Just last year PayPal had over a billion dollars in revenue with over 100 million users.
Google Checkout, which allows shoppers to save their credit card and shipping information in a Google account and then buy products from participating merchants, is not a mirror image of PayPal. In essence, it is a hybrid between PayPal and the one-click ordering system of Amazon.com Inc.
This is a huge story, with many twists and turns to come, for certain.
Google is betting that more searches and faster purchases could deliver even more advertising dollars. Will all of its might help Google get it right? Two other high-tech giants, Microsoft Corp. and Yahoo, previously tried and failed to break into this market. Google could significantly boost its relationship with advertisers who pony up 99 percent of its revenues by showing that clicks are actually resulting in sales, analysts say.
I'll be very interested to see how this all shakes out. I imagine so will thousands of employees and millions of investors!
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