Getting Granular: The DigitalGrit Blog

eBay Buys Verisign

This happened earlier this week, but somehow I missed it.

Here's the deal, short and sweet from MarketWatch (who refer to it a as "good move"):

EBay Inc.'s (EBAY) planned acquisition of VeriSign Inc.'s (VRSN) payment gateway business is getting high marks from industry experts, who say that it will bolster the access that eBay's PayPal payment service has to online merchants.

The two companies late Monday announced an agreement under which the online auction company will pay $370 million in cash, stock or both for VeriSign's business that processes debit card and credit card transactions for small and midsize online merchants. The business will be part of PayPal, which will integrate it with its merchant services business. The deal is expected to close in the current quarter

So, that makes sense. PayPal and Verisign are an obvious pairing.  Just struggling to see how the Weblogs.com acquisition will fit in here. As you'll recall:

.... VeriSign's purchase of Weblogs.com from founder Dave Winer is all about infrastructure and, “pings are well on their way to requiring serious infrastructure.”

But there's more to this than merely beefing up the Weblogs.com ping service, according to Netcraft.

“VeriSign is developing RSS security products for the corporate market, and Weblogs.com can be an asset in that effort,” it says.

Maybe it's because I'm sick today, but I can't wrap my brain around how all this will work under the eBay umbrella.

Feel free to comment on this. I'll be reading up and trying to make sense of this month's acquisition madness.

eBay Buys Verisign

This happened earlier this week, but somehow I missed it.

Here's the deal, short and sweet from MarketWatch (who refer to it a as "good move"):

EBay Inc.'s (EBAY) planned acquisition of VeriSign Inc.'s (VRSN) payment gateway business is getting high marks from industry experts, who say that it will bolster the access that eBay's PayPal payment service has to online merchants.

The two companies late Monday announced an agreement under which the online auction company will pay $370 million in cash, stock or both for VeriSign's business that processes debit card and credit card transactions for small and midsize online merchants. The business will be part of PayPal, which will integrate it with its merchant services business. The deal is expected to close in the current quarter

So, that makes sense. PayPal and Verisign are an obvious pairing.  Just struggling to see how the Weblogs.com acquisition will fit in here. As you'll recall:

.... VeriSign's purchase of Weblogs.com from founder Dave Winer is all about infrastructure and, “pings are well on their way to requiring serious infrastructure.”

But there's more to this than merely beefing up the Weblogs.com ping service, according to Netcraft.

“VeriSign is developing RSS security products for the corporate market, and Weblogs.com can be an asset in that effort,” it says.

Maybe it's because I'm sick today, but I can't wrap my brain around how all this will work under the eBay umbrella.

Feel free to comment on this. I'll be reading up and trying to make sense of this month's acquisition madness.

Smart Take on eBay / Skype Deal: Is pay-per-call the next killer app?

I'm not sure that anyone really understands why eBay decided to acquire Skype. I know I didn't. Nor did I really think about its marketing implications.

Lucky for all of us, Canadian journalist Mark Evans has been thinking about it -- and blogging it. In a number of excellent posts since yesterday, Evans has brought up some great points:

So I listened to the Skype-eBay conference call this morning and talked to many people about the deal - and still can't quite get my head around why eBay is so willing to spend $4.1-billion on a company that had sales of $7-million last year (albeit a target of $60 million in 2005 and $200-million in 2006) and doesn't seem to have a sustainable competitive advantage. Here's my second take on how Skype fits into eBay's strategic thinking:
1. Skype is integrated into eBay as a sales tool, particularly for categories such as automobiles and B2B where eBay can score high margins and healthy profits.
2. Skype is a play in the click-to-talk market, which may or may not materialize as the Web's next killer business app. (My emphasis -ake)
3. Skype is a pure telecom investment play as it win more users and premium customers at a time ...

In a later post, Evans comments further on the pay-per-call aspect:

One more thought about the Skype-eBay deal is you'll hear a lot more about pay-per-call joining pay-per-click (AdSense, etc.) as the next killer e-commerce app based on the idea that buyers or advertisers will pay a fee if people connect to them using VOIP.

This is an interesting point. So, let's say eBay starts more aggressively courting a high-end market, and now you have more prominent eBay stores selling luxury cars, furniture, real estate, expensive electronics -- the sort of things people generally don't buy on impulse. But if those stores offer a click-to-call button -- at the vendors' expense -- surely sales would be easier to close.

Maybe it would open the door for eBay to start selling business services as well as goods. At any rate, it's a service that would appeal to the eBay business owner who can afford a customer service or full-time sales rep (or who runs their business full time and is always available) - but probably not for your next-door-neighbor who occasionally sells his old hockey and Desert Storm cards.

UPDATE: For more info, check out the investor presentation (78 slides!) on eBay's site. While it looks like they'll offer free *and* pay-per-call service, it's unclear how each will be offered.

And here's Marketing Vox's report on the acquisition.

Smart Take on eBay / Skype Deal: Is pay-per-call the next killer app?

I'm not sure that anyone really understands why eBay decided to acquire Skype. I know I didn't. Nor did I really think about its marketing implications.

Lucky for all of us, Canadian journalist Mark Evans has been thinking about it -- and blogging it. In a number of excellent posts since yesterday, Evans has brought up some great points:

So I listened to the Skype-eBay conference call this morning and talked to many people about the deal - and still can't quite get my head around why eBay is so willing to spend $4.1-billion on a company that had sales of $7-million last year (albeit a target of $60 million in 2005 and $200-million in 2006) and doesn't seem to have a sustainable competitive advantage. Here's my second take on how Skype fits into eBay's strategic thinking:
1. Skype is integrated into eBay as a sales tool, particularly for categories such as automobiles and B2B where eBay can score high margins and healthy profits.
2. Skype is a play in the click-to-talk market, which may or may not materialize as the Web's next killer business app. (My emphasis -ake)
3. Skype is a pure telecom investment play as it win more users and premium customers at a time ...

In a later post, Evans comments further on the pay-per-call aspect:

One more thought about the Skype-eBay deal is you'll hear a lot more about pay-per-call joining pay-per-click (AdSense, etc.) as the next killer e-commerce app based on the idea that buyers or advertisers will pay a fee if people connect to them using VOIP.

This is an interesting point. So, let's say eBay starts more aggressively courting a high-end market, and now you have more prominent eBay stores selling luxury cars, furniture, real estate, expensive electronics -- the sort of things people generally don't buy on impulse. But if those stores offer a click-to-call button -- at the vendors' expense -- surely sales would be easier to close.

Maybe it would open the door for eBay to start selling business services as well as goods. At any rate, it's a service that would appeal to the eBay business owner who can afford a customer service or full-time sales rep (or who runs their business full time and is always available) - but probably not for your next-door-neighbor who occasionally sells his old hockey and Desert Storm cards.

UPDATE: For more info, check out the investor presentation (78 slides!) on eBay's site. While it looks like they'll offer free *and* pay-per-call service, it's unclear how each will be offered.

And here's Marketing Vox's report on the acquisition.