Google / Ebay standoff
Investors of eBay headed into the end of last year with some trepidation. The concern: an 800-pound-gorilla named Google would give eBay a drubbing during the 2006 holiday season. The search giant aggressively moved into eBay’s e-commerce territory in 2005 with a product-listing service called Google Base. Last year, it stepped up the challenge, launching Google Checkout, a competitor to PayPal, eBay’s online payment processing service. The new offering was dubbed by press as a PayPal “killer” before it even debuted.
The big surprise of the season, however, was the strength of the services supposed to be suffering at the hands of Google. PayPal posted revenues of $417 million, a 37% growth rate compared with 2005’s fourth quarter. The payment-service company handled a record $11 billion in transactions, up 57%.
