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eBay is one of the most popular sites – particularly for students – to get rid of your unwanted goods. It is the online auction house. But there’s more to eBay than meets the eye.
Little do many people know that about nine years ago, eBay bought Skype. Not that they were in the same area, but clearly they thought that they were on a good thing. Considering Microsoft bought Skype for $8.5 billion in 2011, those decision makers at eBay were probably right!
In 2004, eBay actually bought a substantial stake in Craigslist – the American classifieds and listings website synonymous with the US. Spending the money on that acquisition caused problems with Craiglist, because there were a number of conflicts of interest. At this stage, eBay still retains about 25% ownership.
In 2002, eBay purchased Paypal. That might help explain why Paypal is spread throughout the entire website and is heavily promoted. Many analysts and investors have demanded that eBay sell off Paypal list the company separately to ensure that its true value is reached. The reasoning is that Paypal is performing significantly better than its parent company and should therefore reflect that.
Gumtree is an extremely popular website used by students across Australia, the UK, New Zealand and South Africa (and now much of Europe). In 2005, eBay purchased Gumtree for an unspecified price and has continued to meld the two websites. If you’re looking at selling your goods then usually Gumtree or eBay will provide that opportunity.
As a result of these numerous acquisitions, eBay has been able to eat away at online transactions from people across the world. Taking small percentages each time money is exchanged has been a very profitable business, and has meant that the organisation has continued to grow and wipe out local competitors who are incapable of producing such massive advertising spends. Anyone left needs to compete with an organisation that relies on huge turnover with small payments. Not easy!
So next time you’re buying or selling, just remember that any fees that you’re paying are heading overseas to a multinational.