With the retirement of Meg Whitman after a decade at the helm of eBay, her successor, John Donahue, is already talking about improving search on eBay and and developing a system to present the best deals to shoppers.
That’s fine and dandy but a far more interesting strategic question is what eBay plans to do with two other units: StumbleUpon and Skype. Neither can be considered to be core assets, and eBay hasn’t really done much of anything with either since acquiring them.
From a strategic perspective, there’s no reason for eBay to keep StumbleUpon or Skype. StumbleUpon is a quasi-interesting Web site discovery service, while Skype is a solid, growing business with healthy profit margins. Yet, neither offers any synergies or competitive differentiation for eBay’s core auction business – and let’s not waste any more talk about Skype offering eBay click-to-talk features.
So what does/can eBay do?
Skype should be an easier sale, although eBay will take a financial bath given it will get nowhere near the $4.1-billion that it wildly overpaid to steal Skype away from Google. It’s hard to tell how much StumbleUpon is worth, although there should be no lack of buyers.
In the short-term, dumping both assets will be painful financially and embarrassing corporately but their sales will be a good move in the long-term by allowing eBay to to focus on the core business and, hopefully, use the sale proceeds to buy businesses that are a better strategic fit.
Update: Compete.com’s blog has good analytical post looking at eEbay’s traffic and revenue per unique user numbers.