Nowhere in your article does it state what percentage of Paypal transactions are a result of eBay purchases. Or what amount of revenue is generated by off-eBay Paypal transactions.

Using Q4's numbers as an average...In 2006 there would have been roughly 2.44 billion listings on eBay.com and other eBay auction sites around the world. At a roughly 42% sell-through rate, that would mean that there were approx. 1.03 billion successful transactions. eBay says that the vast majority of items are paid for via paypal. At $.40 per transaction that equals about $410 million in revenue just from per-transaction fees. On top of that, you have the % fee of roughly 3%....say ASP was $11, you would need to add another 3% of $11 billion plus in cummulative transactions or another $340 million.

For a total of around $750 million coming from eBay payments. This doesn't take into account revenue generated through Paypal "loans" on eBay.com that are used to make monthly payments on high ticket items.

eBay Inc.'s total revenue - auction related revenue leaves only $1.77 billion in revenue to be split among Paypal, craigs list, shopping.com, kijiji, rent.com, half.com, skype, AdContext etc.

Anyway, the point is, that it is the auction marketplace that is driving eBay's revenue. Paypal generates quite a lot of revenue as well, but most of the revenue that Paypal generates is as a direct result of eBay transactions.

Paypal traffic is way down too.
http://www.alexa.com/data/details/traffic_details?url=www.paypal.com
How is it possible that it's being used so much more, yet less people are using it?

eBay better contact YouTube and have them remove this video before anyone sees it.
http://www.youtube.com/watch?v=gQ6BxomA-OI

All I know is the revenue and earnings just keep on growing. I love Ebay. A cash cow machine.

And that is FACT! Who cares where Paypal makes it money.

Who cares how they make their money?

Ask the former Enron employees how much they cared where Enron was making its money.

To one of the comments: How can eBay be a "cash cow machine" when the stock has been below the split for over a year now and it doesn't pay a dividend? Have you a clue????

And I don't understand how the writer can dismiss poor business investments like Skype with a "who cares". This is not analysis.....it's just feel good babble with no content.

According to Alexa, Ebay's traffic is about 50% less then it was this time last year. Also, some of the alternative sites (ECrater and Ebid) actually have a greater level of traffic than Ebay Express.

http://www.pheebay.com/blog/2007/03/alexa-traffic-report-for-ebay-amazon.html

http://www.alexa.com/data/details/traffic_details?site0=www.ebay.com&site1=&site2=&site3=&site4=&y=r&z=1&h=300&w=500&range=1y&size=Medium&url=www.ebay.com