Aside from being a lose-lose disaster, an MSN-eBay merger has a lot of appeal

Truth is often stranger than fiction, but not so strange, I think, as to support a Microsoft acquisition of eBay. So while rumors of such a deal, like the one reported in the New York Post last week that had Microsoft chatting with eBay about acquiring the online auction company and merging it with MSN, make for great headlines, they don’t make a whole lot of sense. “I can understand MSN’s motivation in potentially acquiring eBay, but it would be a major negative for eBay shareholder value,” said Stacey Quandt, an analyst at Aberdeen Group. “Microsoft has no expertise in actual commerce and transactions, and there is no natural synergy between the two companies other than that they both have a major Internet presence. Surely, there are less painful ways to improve the stakes for MSN.” Henry Blodget agreed. “Is an eBay-MSN merger a good idea? In a word, no,” he wrote in a post to his Web log. “It’s a bold idea, certainly, one that illustrates Microsoft’s seriousness about making MSN more than an also-ran. But eBay doesn’t need a portal draped on top of it, especially the third-ranked portal, and owning eBay won’t save MSN. The entity would have a fighting chance as a stand-alone company, but Microsoft seems determined to keep strangling its Internet division by keeping all its businesses all under the same roof. As a result, post-merger, eBay’s talent would rapidly depart for greener and less-humongous pastures. And as Microsoft struggled to integrate, staff, and manage a huge new business it knows nothing about, Google and Amazon would get a dream opportunity to chip away at the eBay seller base.”


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  • jerry

    I read until I got to Voldemort’s name. SHUN VOLDEMORT!