It makes sense that a new management team would move aggressively to re-organize the business in their own image. It appears they are looking at each business and even individual categories within the marketplace business and making one of four assessments: (Some businesses may fall into multiple categories)
- Grow it! - I don't see too many of eBay's businesses in this category except for PayPal and Skype. Skype is only included because if it doesn't grow substantially the only other option is to sell it.
Kijiji and the classifieds business could certainly fall into this category, as would the Non-GMV advertising business (excluding Shopping.com)
StubHub should be in this category but I just don't see eBay expanding that business and they should be. Stubhub, is the best acquisition since PayPal.
- Maintain it! - My guess is, we won't know which businesses or verticals will be left alone until all of them have been looked at, so the businesses and verticals to survive the re-org intact, may not be known for awhile.
Some businesses and categories that should be fine are: StubHub, possibly Rent.com and Half.com -- they are both low maintenance money makers. StumbleUpon could also fall into this category -- I don't see management spending the money to grow it.
eBay Stores, Pro-Stores, Motors, Express and many of the categories within the Marketplace business could also be left alone. Some categories are doing just fine within eBay.com or it just wouldn't make any sense to spend the money on them e.g. Express.
Also, Microplace and Giving Works should continue as they have been.
- Reorganise It! - The media category, was the first category to get this treatment and I'm sure the changes there are not complete. I believe, managers are doing an assessment of every category available in the Marketplace business; as well as every business in the entire company.
Look for big changes at Shopping.com as they try to stoke the fire there. Though a possible add slowdown may add to slowing growth at SDC.
- Sell It! or Shut It! - I believe Skype will actually be sold before the end of the year. It is a fast growing business that is much better suited as part of another company, IMO.
Update: Looks like I may be right about this one.
Digital Downloads and Live Auctions were categories that were just too much trouble for what they were worth so management said b'bye. Perhaps other categories will get the axe as well.
One business that is currently in limbo is the Auction biz.
eBay CFO, Bob Swan said in a recent interview with eBay Blogger Richard Brewer-Hay "we do see that fixed price continues to grow faster than our auction-based platform"
So, if fixed price is outpacing auctions where does that leave the auction biz? There's an old saying "if you don't grow, you die". Is this what will happen to Auctions at eBay?
It is going to be a very interesting year and I'm sure we will see movement of some of these eBay categories and businesses into different categories, from where I placed them. It would be my preference that many of them move into the Grow It! category.
Perhaps we should create a "dead pool" for the next eBay business or category to get the axe.
Just my 12%