eBay after the bell 6-28-06: Inital GBuy scare is over

Posted Jun 28th 2006 5:05PM by Melly Alazraki
Filed under: After the Bell, eBay (EBAY)

So after eBay hit a 52-week low yesterday, mainly on fears of up and coming competition from Google, investors had time to cool off and rethink the ramifications of this play. EBay stock gained back 50 cents (1.77%) to close at $28.75.

Already this morning voices were heard that eBay need not fear Google's GBuy because "eBay's PayPal still commands a formidable position in the online purchasing market" with a significant competitive advantage and over 105 million users, as S&P Equity Research analyst Scott Kessler said.

Yet some bloggers noted that people actually await Google's payment system anxiously. In fact, a poll by Digital Point, shows that 42% are going to switch to GBuy given the option. While the poll is anecdotal and unscientific, it is interesting to point out.

The rumored fees for GBuy are a 2.2% commission on a sale, plus 30 cents per transaction. Pay-Pal's rate is 1.9% commission (its lowest published rate) plus 30 cents per transaction. However, while PayPal's rate is lower, Google plans discounts for AdWords merchants who use the service which might actually amount to no fees.

And as if GBuy wasn't enough, a new product from Vonage, V-Phone, could simplify Internet-based calling further. Luckily for Skype, though, the device doesn't seem to be too technologically complicated and Skype could be offerings it soon too.

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Reader Comments (Page 1 of 1)

6-29-2006 @ 3:06AM

Financial said...

thanks for this information

6-29-2006 @ 9:37AM

Jamie said...

I am certainly one of the 42% that would like to leave the ebay/paypal debacle. I traded there for years until I was "taken" by a bad seller. ebay is protecting these scum and screwing me royally. I would like nothing more than to have an alternate venue that will attrack the people that generate revenue by actually buying things. remember, it doesn't matter how many sellers there are if the buyers know that they and their cash are uniquely at risk.

Bring it on GBuy!