Microsoft in Talks To Acquire Ebay

thatedeguy writes "The NY Post is reporting that Microsoft and Ebay are in talks for the online auction house to join the Microsoft family." That said, the talks aren't going that well at the moment. From the article: " Sources indicate that the talks, while still active, have cooled somewhat in the last two weeks as executives considered antitrust issues. It is unclear what the full impact of yesterday's advertising and search alliance between Yahoo! and eBay will be for talks between MSN and eBay. One source close to the matter suggested the Yahoo-eBay tie-up would not stop Microsoft from pursuing the online auctioneer."

Re:mmmm monopolies...

[packetmon]

A lot of lobbying money goes a long way. Right now Google is doing what Microsoft was sued for. If MS played its political cards correctly they'd be able to pull it off (the purchase of eBay). The problem with so called commissions and appointees judging what's right and wrong is that they can often be tainted with money and political influence. MS has deep reaches in Washington hence them getting away with e-Murder for years. What I find to be unmentioned is the foreign take on this. When it comes to matters such as corporations buying each other, I see little foreign intervention. I wonder how many "strawman" companies are under control of American interests end up coming back and buying out a company under a diff name. (Apologies if the explanation seems confusing...) MS tries to buy Company Z. Antitrust worries won't allow it. MS buys Company X in Europe. Company X buys Company Z. Company Z is liquidated back into MS. Happens all the time.

I will stop

[The Cisco Kid]

If MS acquires any sort of control over eBay/PayPal I will close out my accounts with both. No way I trust anything to do with my money to MS.

Re:Reminds me of HotMail

[Anonymous Coward]

I don't understand why this is rated funny. Given that ebay runs on Java switching the server OS should not be a problem at all. One question remains though: Would MS try to switch from Java to .Net?

Re:mmmm monopolies...

[DrSkwid]

In what way is that anything like with bundling IE/Media Player in Windows while having a "monopoly" position in the OS market ?

Does Google have a monopoly in ANY sphere ?

Vista Presence? (was Re:Reminds me of HotMail)

[quarkscat]

Parent poster reminds /. that Microsoft WOULD replace *nix servers at eBay with THEIR
flagship product.

It is not outside the realm of rational thought that Microsoft will be desperate to have
some highly visible enterprise to demonstrate the successful adoption of MS Vista OS,
even if they have to buy the company in order for that to happen. Vista is far behind
schedule, and this only after shedding 90% of the new "gotta-have" features they were
touting. Many, many corporations will be unmoved to migrate to Windows Vista OS
until (1) it is a PROVEN product, and (2) prior MS products reach EOL status.

If Microsoft spends 20% of its' cash reserves to purchase eBay, and then another 20%
to massage a working enterprise IT structure in order to demonstate Vista's viability,
what other choice would they have? Their business plan is dependent upon regularly
scheduled corporate upgrades, including the support contracts and training/certification
treadmill. So long as such a massive acquisition takes place during the current (BushCo)
business climate, they are less likely to get pinged by the DoJ regarding monopoly abuse.

You might say that Microsoft's future business is dependent upon a closing "window of
opportunity" to demonstrate a viable enterprise MS Windows Vista deployment. The
most notable feature of Vista, h/w-s/w DRM with corporate key control, would be an
ideal non-political fit for an enterprise utterly dependent upon e-commerce.

Too bad

[woohootoo]

I've enjoyed doing business with ebay, but it would be over if there's a buyout.

Never happen

[jasonditz]

Microsoft probably would not be able to afford eBay. I'm a shareholder of ebay myself, and the way I see it, I would need either:

$45 per share in cash
or
2.5 MSFT shares per 1 ebay share

Which means Microsoft is either going to have to issue $30 billion in debt and spend all their existing cash, or relinquish 30%+ of the ownership of the combined company to eBay shareholders.

I find it hard to believe they're willing to do either.

Now, if they want to buy Skype from us or something, that's a different matter.

Re:ummm

[Anonymous Coward]

I've glanced at the marketing vision/strategy surrounding eBay. Desperate isn't the right word. Tradeoffs is. Microsoft executives aren't stupid -- they've just decided it's cheaper to buy a packaged solution (and in doing so remove a competitor) than build one from scratch. One reason for this is they expected eBay to sue for at least one patent violation (although Microsoft policy is that none of us employees knows what patents eBay has, but it was a reasonable guess that we'd step on toes).

My company is very interested in building MSN for the ad revenue, and right now they think "renewable content" is key. This is why they've invested heavily in the entertainment side of MSN (they believe teens crave music and videos, and they want MSN to integrate with WMP so it's easier than the other guys) and why Live.com is all about personalization (they want people to take ownership of the site). The overall goal is to get customers who schedule time to view MSN holdings and thus the ads.

eBay presents an attractive purchase because we all know how many people do schedule it into their lives. Think if just 10% also started using MSN because it was integrated. The ad revenue earned PLUS the ad revenue taken from Yahoo/Google PLUS the momentum shift from the extra users makes the purchase worth it. PayPal is also attractive for its loyal customer who will view MSN ads. The executives are leery of using PayPal as a "preffered" payment gateway because the logical step is to incorporate it into the huge failure Passport. On the other hand, with the subscription model publically announced for Vista, MS would like to forgo as much of the credit card fees as possible with their billion-dollar cash cow.

(I'm posting as AC on neighbor's wireless since this may violate my NDA.)

Special eBay features for IE users only?

[markdj]

And if MS ran eBay, would there be special features only available to IE users? That would encourage eBay users to use Windoze instead of Apple or Linux.

Skype

[trenien]

Well, ebay bought out skype a while ago, and I somewhat doubt they'd be willing to let it go so fast.

Skype would be perfect for M$ and the way it does business - foothold in the market, recognized name, closed proprietary soft and protocols...

Wouldn't it be enough of a reason for M$ (I don't quite see how an auction-style site could interest them)