The story of the online auction monopolist eBay

eBay. A firm which in 2011 had a net income of more than 3.2 billion. A website which almost everyone has heard of.

In an article I recently posted which explored whether there is really that much diversity online, I noted how eBay owned four websites in Alexa’s top 100 ranking – eBay.com, eBay.de, eBay.co.uk and PayPal.com.

There is no doubt that eBay holds a monopoly on the online auction market. But how did it get there? On September the 2nd 1995, eBay didn’t exist. One day later on September the 3rd it did, and after just over 3 years and 6 months, the site made its first major acquisition, the auction house Butterfield & Butterfield which it purchased for the price of $260,000,000 USD. A spend of 260 million after less than four years trading? eBay’s rapid early growth set it up to become a global internet phenomenon.

eBay kept buying up smaller firms, but not spending nearly as much as it had on its first purchase until mid-2000 when it forked out 318 million (USD) to buy Half.com. This was an amazing investment at the time, as even today it stands as eBay’s 6th largest ever investment, and it has made hundreds.

PayPal's logoThat said, the purchase of Half.com was to prove small fry to PayPal, which the now giant auctioneer purchased 2 years later in July 2002 for an astounding $1.5 billion. PayPal integration with eBay is (in my opinion) one of its greatest ever business moves. eBay is now able to seamlessly integrate processing credit card payments without having to pay millions every year to third parties. Fees eBay would have lost to PayPal are now extra revenues.

eBay wasn’t done though, going on to make the biggest purchase in its history, by buying Skype Limited for more than $2.5 billion. The auction site purchased the Luxembourg based company in 2005, only to sell 70% of its shares in 2009 for $2 billion – a healthy profit. Later, in May 2011, Microsoft bought Skype in its entirety for $8.5 billion, an investment which I am not sure it will see great returns on in the near future at least.

Skype's LogoeBay started to turn into a Microsoft and a Google. It was fast becoming an internet giant which bought up pretty much anything it could see turning it a bigger profit, or anything which posed a threat – in terms of competition. Just some of its purchases include StumbleUpon, Bill Me Later and Magento, the ecommerce web application.

Many say that eBay is one of the most notable successes the dot-com bubble, and I have to agree. Without the internet, eBay would be nowhere. It got in early and grew from the start, giving its competition very little chance.

Like it or hate it, eBay is an internet phenomenon, and also an internet giant. In my opinion it is successful down to luck: a good idea at the right time. Had it been thought of a year later, eBay might not be what it is today, had the internet not really taken off as it has and still is doing, eBay would again might not be where it is today.

What are your views on eBay? Were you aware of how much it owns and how rich it is? Is its monopoly unfair, or don’t you mind?

Should You Create a Mobile Version of Your Website?

Chances are if you walk through your local town centre today, you’ll see somebody accessing the internet on their smart phone. It’s almost become a second nature.

Gone are the days of simple WAP access, people are now using their phones to browse their favourite websites and even shop online. In fact, it’s reported that netbook sales are down 40% so is this a sign that smartphones and tablets are overtaking PC’s as peoples preferred browsing method?

So should you create a mobile version of your website? In short, yes, and here’s some reasons why.

Mobile internet use is growing rapidly

According to some figures mobile internet access is now at 8.09% of all UK website traffic (up from 0.02% in 2009) so whether you like it or not, people are going to access your website from a mobile browser.

It’s not that difficult to create a mobile version

Of course it depends on how your website was built in the first place, but if it’s not archaic then usually incorporating what’s needed to make your website mobile friendly isn’t too difficult and doesn’t require starting from scratch.

Most websites don’t work well on mobiles

The fact is, the majority of websites don’t well on mobiles, in fact some of them are impossible to use, so it’s a great way to steal a competitive advantage and get in early ahead of others in your industry. That said, if you run WordPress or another blogging platform, there are plugins that can make your site ‘mobile friendly’.
Google's mobile website being used on an iPhone

Mobile users have different intent

When people use the internet on their phones, they usually have a different intent to a user sat at a PC. It’s usually on the move, and they don’t have much time, meaning they’re looking for something to solve a problem fast. If you do a quick search on mobile conversion rates for ecommerce you’ll find they’re very high. So if you design your site to cater for those needs you’re onto a winner.

It’s way more important than having an app

Since mobile apps became the latest novelty, many businesses have wasted good time and money on developing their own mobile application, of course these apps have their uses, but for the majority of businesses they are a waste of money and wallow at the bottom of the app store.

A mobile website doesn’t require separate development for Android, iPhone, Blackberry and doesn’t need promoting via an app store so is clearly a better choice for getting a return on investment.

Mobile browsing is still very new

Even though lot’s of people are browsing the internet via mobiles, it’s still a relatively new concept, and one that realistically can only every grow upwards due to how technology is advancing. Historically early adopters are the ones that reap the reward, so why wait till everyone else is a step ahead of you?

What about you?

How many of you have optimised your site for mobiles or considered it? Do you think it’s more important for blogs to or ecommerce sites to opimise for mobile? Or is it equally important for both?