Not much commentary is needed on this one. Here’s what happened:
- eBay doesn’t allow merchants to use Google Checkout to settle eBay transactions. Google invited eBay online sellers attending eBay Live! in Boston this week to a party that they called the Google Checkout Freedom Party.
- eBay decides to pull all U.S. advertising on Google.
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Google backs down, cancels the party.
- Google looks like a complete wimp; eBay looks like a bully.
The party appeared to be nothing more than Google poking a little fun at eBay’s restrictive policies. eBay hit back with the biggest weapon they had, suggesting that tension between the companies goes very deep.
I wonder if some Product Marketing Manager at Google on the Google Checkout product just lost his job because he decided to try and steal some Paypal merchants. This smacks of a decision made at a low level without thought of the high level consequences.
As Google enters more and more markets, this type of thing could become much more common. I am not worried about parties being canceled (I never even received any invitations to any of them), but the core competitive nature and level of collaboration that is happening between companies.
How the companies balance them will be interesting to see.
This totally makes sense. I’m wondering if the company that supposedly does no evil gets their definition of “evil” from the same dictionary that Bill Clinton uses. How many people have felt that Google has done evil against them? I have, more than once. (I cringe as I write this, hoping they don’t get po’d and do more evil against my accounts)
Jason Alba
CEO – JibberJobber.com
because no job is secure… not even yours!
Jason – google was throwing a party. they want ebay merchants to have the choice to use their checkout product. that isn’t anywhere close to acting evil.
well ebay also shouldn’t buy the entire dictionary and use PPC for it. Doing a search for “dead puppies”, “used diapers” and “lasting legacy” all give me “Find it on ebay!” results. And PayPal should get at least minimal customer service.
google was using a very aggressive marketing tactic …
ebay returned the aggression (good move) …
google caved …
no one did anything wrong here, but also no one has the moral high ground.
I don’t think eBay was a bully – they responded to an attempt by Google to “take” away their most important customers.
Will Google stock feel a hit tomorrow?
From the looks of the adverts here on TC, PayPal is still on Google Advertising. Perhaps next move is rook to b5: Google axes PayPal from advertising.
I just read an analysis that eBay is one of largest users of Adwords…their marketing budget is approx is huge (~1.2B?) with 62% of that going online (annual report). They could be as much as 3% of Google’s advertising revenues according to the analysis I read. No wonder Google stood down!
Good for EBay….
http://www.what...&Itemid=279
I’m surprised at all the ebay love. All of their primary assets are walled gardens – payments, reputation, skype, ebay listings.
#8 Chandra – but going back to my original q – did they put the ads back or are they gone?
If so, and your numbers are correct, look for a dip in goog in the am.
Here is an article about it on reuters:
http://www.reut...339779620070613
eBay was disappointed about the Google event. “We don’t view that kind of activity as an appropriate activity for one partner to do to another.”
I have never used google checkout I often use paypal in all my sites.
It is hard for google to break into the ebays paypal market.
Michael – remember that an enemy of your enemy is a friend. (or something like that).
I hate the triple fee ripoff on eBay. I like that I can sell anything and since they opened their doors have always been able to get what I wanted for the items.
If eBay was a country, counting their sellers as employees, it would be the 9th largest country in the world.
good for ebay! it’s pretty clear that google checkout has been a flop so far.
I think ebay’s in trouble. Just my .2
google will look for startup friends.
Ouch, talk about overpowered. Not very good for competition.
This looks pretty serious… I tried googling for a few keywords like Wii, laptop, and all the usual stuff that should bring up the “Buy at Ebay” ad but did not see any. The only query that came up with an Ebay Ad is a search for Ebay.
If Ebay is stopping all Ads, then this is a huge blow for Google. Surely, we’ll see quite a few heads rolling internally at Google.. you think?
Do I understand this correctly? eBay uses commercial leverage to reduce choice for its customers, or at least deny them a night out on Google’s dime. The leverage? It threatens to reduce traffic to eBay customers by reducing its ad spending with the top ad network. “If you compliment my kid I’ll spank him”
Sounds like Visa crowing in an ad campaign that you should use their cards because they paid famous merchants not to take Amex.
Google was doing what they should be to drum up business. eBay was sleazy here. Give that Google PM a bonus (not that the poor guy needs it).
This incident just proves that the BS about “frenemies” or “coopetition” that runs rampant on the web *isn’t* sustainable, nor should it be. These large cap Internet companies are competitors. Google competes with eBay, Yahoo, MSN, FIM, Viacom, Time Warner, AOL & NBC.
To think they can all coexist without clashes like this is ridiculous. We should all expect — almost demand — hardcore, bare-knuckles competition. It’s good for markets to have fierce competition. The airlines all hate each other, and competition is now extreme, and prices are relatively low as a result.
The web is different for some reason. The friend crap should end. Maybe this is the watershed event that kicks things into gear!
I guess Google should stick to throwing their weight around with small companies they can afford to buy.
but google could erase ebay from their index and not show ebay adwords on search words. i though the balance of power was always in google’s hands???
the words “nose”, “spite” and “cut off” spring to mind. What a puerile move by ebay. They obviously use adwords as it drives significant traffic
Why did Microsoft have to allow competitor ISP and browsers to be pre-installed on the OS whereas a website such as eBay can force people to only use ONE (their own) online transaction system?
PayPal works well but their customer service is abysmal, IMHO. I wish they’d have some competition, in the form of Google Checkout or something else. At the same time, it is easy to understand their reaction of fear considering that Google is the only company that has been able to freak out the biggest bully of all, Microsoft. eBay is freaking out for its money machine too. Maybe it will be good for the government to look at eBay’s quasimonopoly in this space at some point in the future (this is the kind of things governments are good for). Really, it is not normal, in a system handling so many transactions on a daily basis, that the only convenient and secure way to complete said transactions is owned by them.
Good for Ebay. Google needs to be notched down a few, and it’s better done in the “field” then to have the Feds come in and teabag them. Mind you, I’m not much of an Ebay fan, butt hay…
Maybe Google could start the revolution by requiring that anyone using AdWords be required to provide Google Checkout support if the goods they advertise are sold online?
This recent report from comscore shows ebay being the number 1 and 3 search marketer for an almost 6% share. Don’t forget Shopping.com.
http://www.dmne...erce/41433.html
That could ding a growth stock pretty good.
eBay doesn’t look like a bully. It just made itself badass today and standing up for their entities.
How dare them.
Uuugh. I have much love for eBay but not their horrible PayPal. Good for Google… at least with Google Checkout I can use a credit card without being hounded. PayPal’s fraud protection is terrible, and they have no customer service.
I don’t think Google will back off that easily. I wonder what will happen to the SERPs over the next days.
I remember that shop names/profiles rank very high in Google. So do many ended auctions. Sounds supplemental index to me.
Finally, forget the web2.0 hugging. Business will come to life. The next two years might become interesting. Watch out for the Big Players to invest in FaceBook apps and all grow a share in FB’s popularity.
FaceBook where anyone is welcome.
Come on google! Fight back! Paypal is horrible. They always bully the most vulnerable, the sellers, cause on buyer’s side, they have to fight the banks. They treat every merchant as a criminal and take money from their accounts whenever they like without explicit explanations. The only reason that Paypal can blatantly ignore customer’s outrage is that they are the only player in the game. You want to sell on eBay? You have no choice!!! Take a look at paypalwarning.com/, horrible…
Jean-Michel, please check out the Google Checkout and Paypal alternative – http://www.kushcash.com
Google should have put their product where their mouth is. If adwords are better than the alternative (yahoo words or whatever they are called) then pony up and see who does worse out of ebay and google out of the whole thing.
I think it was a bluff by ebay and google has set precedent that they are pussies when you pull ad revenue away from them.
ebay is not bully,
it is business world,
and just want to take advantage from each other.
Hey, I finally got a direct response from Michael Arrington … kewl!!
I think what they did, inviting partner/competitor’s clients (online sellers) to a “party” to show them there are alternatives. (I want to know which seller DIDN’T know about alternatives) It seems to me that the partner, paypal/ebay would be pretty pissed. I would be. It’s a slap in the face, considering the partnership is going well (or at least significant (see comment #8)).
If they did this to any of the smaller payment sites (like comment #33) wouldn’t this have been considered *more* rotten?
Definition of evil is subjective, but I’ve been crossed by the evil Google with adwords. Talk about no support, no recourse. Give me a break – Google walks all over everyone, they eat up some companies and make people very, very wealthy, but they also destroy other companies. They are the eight thousand pound gorilla.
This was a low blow, imho, and it was cool that eBay had the power to fight back. I wonder what other companies has the power to fight against Google.
Now, having said that, I *heart* Google, and use them all the time, with various services. Again, I’m hoping that someone doesn’t get upset and take down my services :/
Jason Alba
CEO – JibberJobber.com
… because I’ll never be allowed to work at Google (I’m not smart enough)…
good for ebay. google was being stupid to think they could promote their services on ebay’s dime.
Ebay let’s people use Western Union or Money Orders but not Google Checkout? That doesn’t sound very good.
If Ebay was to pull all of its ads from Google, and if their spend on Adwords were 3% of Google’s Ad revenue, that does not mean they lose that 3%.
Here is why:
- It’s a bidding system; there are many other advertisers waiting behind ebay to take its place for each keyword. If there was not ebay ad to click, there will be some other ad, and Google will make its money.
- There tens of thousands of eBay affiliates, who will happily take eBay’s place to bid on those keywords, and Google will make its money.
Lastly, if ebay and google went on a full war, Google would win it, no doubt. If was a wimpy move on them to cancel a party called “Google Checkout Freedom Party”. You can’t back down on freedom man, as Bust would say.
They bent over for eBay, like they did for China.
Google, have some bones and reinstate the party! I’ll drive from NY for free food and booze, even though I don’t use ebay much.
I wonder how ebay’s revenue will show for this quarter if the ads don’t return. (And I would love if Google would just kill ebay from the search results. It would *KILL* ebay stock
)
fundamentally this is a silly marketing move by Google. You dont rub wrong side of your biggest client. duh !! dont bite the hand that feeds you.
Anyway, it is a lesson for both companies. For Ebay – dont depend too much on Google, they are too wily and dont mind doing ‘evil’.
For Google, maybe it is time you act like big brother, than a silly tyrant. maybe they should have held the party…
Shit, I would praise Baby Jesus if eBay pulled their Google ads. No matter what I search for, there’s always an ad to “Find ___ on eBay!” even if it’s something completely intangible. Freaking so annoying.
who do you think really suffers if Ebay pulls out of Google? There’s a reason Ebay buys practically every word in the English dictionary…they need the traffic…Q: who’s got the faster organic growth rate? A: “you can’t find it at Ebay…(insert lame jingle here). Power sellers can save on the ridiculous Ebay fees and move their stuff through Adwords….Ebay threw the baby out w/ the bathwater. I give their “marketing experiment” a couple days tops. Google should just write a check and we can start calling it Gbay.
I think this event just triggered my alarm clock. In other words eBay’s corporate development team may be “searching” for an alternative platform and I have an idea what it is. AND no it’s not Yahoo or Microsoft…. as a matter of fact, I’m not even sure it has been written about in Techcrunch, yet.
It will be interesting to see how this works out in a couple of months, to see who needs who more. eBay may be Google’s biggest client but not their only one.
Well boohoo eBay, Google has a competing product and you don’t want anyone to use it. Grow the hell up. Google has the best, biggest and most popular search engine, maybe you should feel how it is to be dropped in the serps for a day or two, I am sure Google would just call it an “update”.
If MySpace blocks Photobucket, then according to you, Mike, “MySpace showed who is the boss”. If eBay threatens to pull all advertising from Google, then according to you, Mike, “eBay is acting as a bully”. May we, the readers, dare ask, why you are starting to maintain double standards in writing these days
No love for e-bay here as it acted to preserve its monopoly position rather than tolerate competition, a move that was about as customer friendly as AT&T’s decision to rat on its users to protect a new business model.
Also, Paypal is a fucking nightmare when it screws up and whilst we are on the subject of large corps restricting transactions to one payment system lets hear it for Yahoo ref:
“I’m very sorry to hear about your PayPal complaint. Eventually, we will offer other payment options. However, all online transactions for Flickr go through PayPal.”
news just in…google is acquiring Ebay!
joking -_-
GOOG should buy Ebay. Ebay is so mismanaged that GOOG would be able to take ebay and paypal and milk money out of these properties day and night while still making them better for the end user. I highly doubt the FTC would go for the combo though.
Rdahl, thanks for the link to Kushcash. Looks very cool. I hope they’ll have a widget for the my upcoming iPhone!
Google should have made Google Checkout a real paypal killer. Instead they only focused on the stores. If they had a user-to-user transaction service, they wouldn’t have to rely on ebay allowing their services.
Users would jump ship the second google would announce it. The only reason majority of people use paypal, is because its the biggest player in the game.